I Only wants the correct option like A, B, C, D, or E 1. Geek Squad performs services for a customer and bills the customer for $500. How would Geek Squad record this transaction? a. Accounts receivable increase by $500; revenues increase by $500. b. Cash increases by $500; revenues increase by $500. c. Accounts receivable increase by $500; revenues decrease by $500. d. Accounts receivable increase by $500; accounts payable increase by $500. e. Accounts payable increase by $500; revenues increase by $500. 2. Indicate which of the following statements is true. a. Since intangible assets lack physical substance, they need be disclosed only in the notes to the financial statements. b. Goodwill should be reported as a contra-account in the owner’s equity section. c. Totals of major classes of assets can be shown in the balance sheet, with asset details disclosed in the notes to the financial statements. d. Intangible assets are typically combined with plant assets and natural resources and shown in the property, plant, and equipment section 3. A company forgot to record accrued and unpaid employee wages of $350,000 at period-end. This oversight would a. Understate net income by $350,000. b. Overstate net income by $350,000. 2 c. Have no effect on net income. d. Overstate assets by $350,000. e. Understate assets by $350,000 4. Prior to recording adjusting entries, the Supplies account has a $450 debit balance. A physical count of supplies shows $125 of unused supplies still available. The required adjusting entry is: a. Debit Supplies $125; Credit Supplies Expense $125. b. Debit Supplies $325; Credit Supplies Expense $325. c. Debit Supplies Expense $325; Credit Supplies $325. d. Debit Supplies Expense $325; Credit Supplies $125. e. Debit Supplies Expense $125; Credit Supplies $125 5. On November 1, 2015, Stockton Co. receives $3,600 cash from Hans Co. for consulting services to be provided evenly over the period November 1, 2015, to April 30, 2016—at which time Stockton credited $3,600 to Unearned Consulting Fees. The adjusting entry on December 31, 2015 (Stockton’s year-end) would include a a. Debit to Unearned Consulting Fees for $1,200. b. Debit to Unearned Consulting Fees for $2,400. c. Credit to Consulting Fees Earned for $2,400. d. Debit to Consulting Fees Earned for $1,200. e. Credit to Cash for $3,600. 6. If a company had $15,000 in net income for the year, and its sales were $300,000 for the same year, what is its profit margin? a. 20% b. 2,000% c. $285,000 d. $315,000 e. 5% 3 7. Which of the following errors would cause the Balance Sheet and Statement of Owner’s Equity columns of a work sheet to be out of balance? a. Entering a revenue amount in the Balance Sheet and Statement of Owner’s Equity Debit column. b. Entering a liability amount in the Balance Sheet and Statement of Owner’s Equity Credit column. c. Entering an expense account in the Balance Sheet and Statement of Owner’s Equity Debit column. d. Entering an asset account in the Income Statement Debit column. e. Entering a liability amount in the Income Statement Credit column 8. A company purchased $4,500 of merchandise on May 1 with terms of 2/10, n/30. On May 6, it returned $250 of that merchandise. On May 8, it paid the balance owed for merchandise, taking any discount it is entitled to. The cash paid on May 8 is a. $4,500 b. $4,250 c. $4,160 d. $4,165 e. $4,410 9. Hughes Company has a credit balance of $5,000 in its Allowance for Doubtful Accounts before any adjustments are made at the end of the year. Based on review and aging of its accounts receivable at the end of the year, Hughes estimates that $60,000 of its receivables are uncollectible. The amount of bad debts expense which should be reported for the year is: a. $5,000. b. $55,000. c. $60,000. d. $65,000 10. Net sales for the month are $800,000, and bad debts are expected to be 1.5% of net sales. The company uses the percentage-of-sales basis. If Allowance for Doubtful Accounts has a credit balance of $15,000 before adjustment, what is the balance after adjustment? a. $15,000 b. $27,000 . c. $23,000 d. $31,000 4 11. One of the following statements about promissory notes is incorrect. The incorrect statement is: a. The party making the promise to pay is called the maker. b. The party to whom payment is to be made is called the payee. c. A promissory note is not a negotiable instrument. d. A promissory note is often required from high-risk customers. 12. Depreciation is a process of: a. valuation. b. cost allocation. c. cash accumulation. d. appraisal.
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
I Only wants the correct option like A, B, C, D, or E
1. Geek Squad performs services for a customer and bills the customer for $500. How would
Geek Squad record this transaction?
a.
b. Cash increases by $500; revenues increase by $500.
c. Accounts receivable increase by $500; revenues decrease by $500.
d. Accounts receivable increase by $500; accounts payable increase by $500.
e. Accounts payable increase by $500; revenues increase by $500.
2. Indicate which of the following statements is true.
a. Since intangible assets lack physical substance, they need be disclosed only in the notes to the
financial statements.
b.
c. Totals of major classes of assets can be shown in the balance sheet, with asset details disclosed
in the notes to the financial statements.
d. Intangible assets are typically combined with plant assets and natural resources and shown in
the property, plant, and equipment section
3. A company forgot to record accrued and unpaid employee wages of $350,000 at period-end.
This oversight would
a. Understate net income by $350,000.
b. Overstate net income by $350,000.
2
c. Have no effect on net income.
d. Overstate assets by $350,000.
e. Understate assets by $350,000
4. Prior to recording
count of supplies shows $125 of unused supplies still available. The required adjusting entry is:
a. Debit Supplies $125; Credit Supplies Expense $125.
b. Debit Supplies $325; Credit Supplies Expense $325.
c. Debit Supplies Expense $325; Credit Supplies $325.
d. Debit Supplies Expense $325; Credit Supplies $125.
e. Debit Supplies Expense $125; Credit Supplies $125
5. On November 1, 2015, Stockton Co. receives $3,600 cash from Hans Co. for consulting
services to be provided evenly over the period November 1, 2015, to April 30, 2016—at which
time Stockton credited $3,600 to Unearned Consulting Fees. The adjusting entry on December
31, 2015 (Stockton’s year-end) would include a
a. Debit to Unearned Consulting Fees for $1,200.
b. Debit to Unearned Consulting Fees for $2,400.
c. Credit to Consulting Fees Earned for $2,400.
d. Debit to Consulting Fees Earned for $1,200.
e. Credit to Cash for $3,600.
6. If a company had $15,000 in net income for the year, and its sales were $300,000 for the same
year, what is its profit margin?
a. 20%
b. 2,000%
c. $285,000
d. $315,000
e. 5%
3
7. Which of the following errors would cause the Balance Sheet and Statement of Owner’s
Equity columns of a work sheet to be out of balance?
a. Entering a revenue amount in the Balance Sheet and Statement of Owner’s Equity Debit
column.
b. Entering a liability amount in the Balance Sheet and Statement of Owner’s Equity Credit
column.
c. Entering an expense account in the Balance Sheet and Statement of Owner’s Equity Debit
column.
d. Entering an asset account in the Income Statement Debit column.
e. Entering a liability amount in the Income Statement Credit column
8. A company purchased $4,500 of merchandise on May 1 with terms of 2/10, n/30. On May 6, it
returned $250 of that merchandise. On May 8, it paid the balance owed for merchandise, taking
any discount it is entitled to. The cash paid on May 8 is
a. $4,500
b. $4,250
c. $4,160
d. $4,165
e. $4,410
9. Hughes Company has a credit balance of $5,000 in its Allowance for Doubtful Accounts
before any adjustments are made at the end of the year. Based on review and aging of its
accounts receivable at the end of the year, Hughes estimates that $60,000 of its receivables are
uncollectible. The amount of
a. $5,000. b. $55,000. c. $60,000. d. $65,000
10. Net sales for the month are $800,000, and bad debts are expected to be 1.5% of net sales. The
company uses the percentage-of-sales basis. If Allowance for Doubtful Accounts has a credit
balance of $15,000 before adjustment, what is the balance after adjustment?
a. $15,000 b. $27,000 . c. $23,000 d. $31,000
4
11. One of the following statements about promissory notes is incorrect. The incorrect statement
is:
a. The party making the promise to pay is called the maker.
b. The party to whom payment is to be made is called the payee.
c. A promissory note is not a negotiable instrument.
d. A promissory note is often required from high-risk customers.
12.
a. valuation.
b. cost allocation.
c. cash accumulation.
d. appraisal.
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