You are the bookkeeper for a small but thriving business.  You have asked the owner for the information you need to make adjusting entries for depreciation, supplies , insurance, and wages.  He says that he's really busy and that what you've done so far is "close enough". Explain the need for adjusting entries and their effect on the owner's balance sheet and the "bottom line" of the income statement.

A prepaid expense is one of the assets which are on a balance sheet that a company or rather a business is paying in advance for the services and goods that they are yet to receive in the future. Prepaid expenses’ value is made over time onto the income statement but is initially recorded as an asset. So as to ensure a record sense of accountability, a company must adjust these expenses so as to ensure that the expenses are recognized within the period that the expenses are incurred within the business period. This expense is placed in the debit column before it expired, however, it has to be moved to the credit column. There are a number of adjustments that most of the companies do make entries to before they prepare their ultimate report on the financial period. Some of these adjustments include; accrued expenses, accrued revenue, depreciation expenses and even deferred revenues. What is your opinion?

If a company faced loss, while preparing the worksheet for the company, which sentence is correct for recording the loss? Select one: a. The loss is placed in the income statement debit column and balance sheet credit column. b. The loss is placed in the income statement credit column and balance sheet debit column. c. The loss is placed in the income statement debit column and balance sheet debit column. d. The loss is placed in the income statement credit column and balance sheet credit column.

True or false: An owner of a small business usually knows if the business is receiving the assets and services the company paid for.

The starting point of the accounting process is communicating information to users. identifying economic events. recording economic events. none of these answers are correct.

An employee working on her first trial balance discovers that the Equipment account has a credit balance of $2500 and a customer's A/R account has a credit balance of $25. Based on the knowledge you have gained in this course and how account balances are recorded and increase/decrease, has the accountant made a mistake in her records or are these situations possible?

Just answer true or false. no need for an explanation