MyAccountingLab Access Code
3rd Edition
ISBN: 9780132952644
Author: Pearson
Publisher: Pearson College Div
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Chapter 3, Problem 3MCQ
To determine
Identify the correct example of a deferral.
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Which is NOT an example of a type of event that is not currently recognized in the financial statements but could impact future cash flows?
A.
litigations against the company
B.
services that were billed to a customer on account but payment has not been received
C.
a contract to deliver goods
D.
existing contract to preform services
When cash is paid for expenses, the business has less cash; therefore, the asset account Cash is decreased and the owner's equity account is deacreased. Is it true or false? Explain your answer
Which of the following transactions violates the balance sheet equation? (check all that apply)
a. Reduce cash and reduce a liability
b. Increase revenues and reduce a liability
c. Increase cash and increase an expense
d. Increase cash and reduce inventory (a non-cash asset)
e. Increase cash and reduce a liability
Chapter 3 Solutions
MyAccountingLab Access Code
Ch. 3 - Prob. 1YTCh. 3 - Prob. 2YTCh. 3 - Prob. 3YTCh. 3 - Prob. 4YTCh. 3 - Prob. 5YTCh. 3 - Prob. 6YTCh. 3 - Prob. 7YTCh. 3 - How does accrual basis accounting differ from cash...Ch. 3 - Prob. 2QCh. 3 - Prob. 3Q
Ch. 3 - Prob. 4QCh. 3 - What are accrued expenses?Ch. 3 - Prob. 6QCh. 3 - Prob. 7QCh. 3 - Name two common deferred expenses.Ch. 3 - What does it mean to recognize revenue?Ch. 3 - How does matching relate to accruals and...Ch. 3 - What is depreciation?Ch. 3 - Why is depreciation necessary?Ch. 3 - Prob. 13QCh. 3 - Prob. 14QCh. 3 - Prob. 1MCQCh. 3 - Prob. 2MCQCh. 3 - Prob. 3MCQCh. 3 - Prob. 4MCQCh. 3 - Prob. 5MCQCh. 3 - Prob. 6MCQCh. 3 - Prob. 7MCQCh. 3 - Prob. 8MCQCh. 3 - When prepaid insurance has been used, the...Ch. 3 - Prob. 10MCQCh. 3 - Prob. 1SEACh. 3 - Prob. 2SEACh. 3 - Account for interest expense. (LO 1, 2). UMC...Ch. 3 - Prob. 4SEACh. 3 - Account for insurance expense. (LO 1, 3). Catrina...Ch. 3 - Prob. 6SEACh. 3 - Account for unearned revenue. (LO 1, 3). Able...Ch. 3 - Prob. 8SEACh. 3 - Prob. 9SEACh. 3 - Prob. 10SEACh. 3 - Calculate profit margin on sales ratio. (LO 5)....Ch. 3 - Prob. 12SEBCh. 3 - Prob. 13SEBCh. 3 - Prob. 14SEBCh. 3 - Prob. 15SEBCh. 3 - Prob. 16SEBCh. 3 - Prob. 17SEBCh. 3 - Prob. 18SEBCh. 3 - Prob. 19SEBCh. 3 - Calculate net income. (LO I, 4). Suppose a company...Ch. 3 - Prob. 21SEBCh. 3 - Prob. 22SEBCh. 3 - Prob. 23EACh. 3 - Prob. 24EACh. 3 - Prob. 25EACh. 3 - Prob. 26EACh. 3 - Prob. 27EACh. 3 - Prob. 28EACh. 3 - Account for insurance expense. (LO 1, 3). Yodel ...Ch. 3 - Prob. 30EACh. 3 - Prob. 31EACh. 3 - Prob. 32EACh. 3 - Prob. 33EACh. 3 - Prob. 34EACh. 3 - Southeast Pest Control, Inc., was started when its...Ch. 3 - Prob. 36EACh. 3 - Prob. 37EACh. 3 - Prob. 38EACh. 3 - Prob. 39EACh. 3 - Prob. 40EBCh. 3 - Prob. 41EBCh. 3 - Prob. 42EBCh. 3 - TJs Tavern paid 10,800 on February 1, 2010, for a...Ch. 3 - Prob. 44EBCh. 3 - Prob. 45EBCh. 3 - Account for insurance expense. (LO 1, 3). All...Ch. 3 - Prob. 47EBCh. 3 - Prob. 48EBCh. 3 - Prob. 49EBCh. 3 - Prob. 50EBCh. 3 - Prob. 51EBCh. 3 - Prob. 52EBCh. 3 - From the following list of accounts (1) identify...Ch. 3 - Prob. 54EBCh. 3 - Prob. 55EBCh. 3 - Prob. 56EBCh. 3 - Prob. 57PACh. 3 - Prob. 58PACh. 3 - Prob. 59PACh. 3 - Following is a partial list of financial statement...Ch. 3 - Prob. 61PACh. 3 - Record adjustments. (LO 1, 2, 3). The Gladiator...Ch. 3 - Prob. 63PACh. 3 - Transactions for Pops Company for 2011 were as...Ch. 3 - Record adjustments and prepare financial...Ch. 3 - Prob. 66PACh. 3 - Prob. 67PACh. 3 - Record adjustments and prepare income statement....Ch. 3 - Prob. 69PBCh. 3 - Prob. 70PBCh. 3 - Following is a partial list of financial statement...Ch. 3 - Prob. 72PBCh. 3 - Record adjustments. (LO 1, 2, 3). Summit Climbing...Ch. 3 - Prob. 74PBCh. 3 - Prob. 75PBCh. 3 - Record adjustments and prepare financial...Ch. 3 - Prob. 77PBCh. 3 - Prob. 78PBCh. 3 - Identify and explain accruals and deferrals. (LO...Ch. 3 - Prob. 2FSACh. 3 - Prob. 3FSACh. 3 - Prob. 1CTPCh. 3 - Prob. 1IECh. 3 - Prob. 3IECh. 3 - Prob. 4IE
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- Which of the following statements is incorrect? A. The accrual method, which builds directly on the revenue and matching principles, ignores the timing of cash receipts or payments determining when to revenue or expenses. when recognize B. In accordance with the going concern assumption, the life of the business is presumed to be indefinite. C. Expenses are matched with revenues, not the reverse. D. In accordance with the unit of measure assumption, accountants normally revise the amounts to reflect the changing purchasing power of money due to inflation or deflation.arrow_forwardWhich sentence is incorrect? Select one: a. Cash-basis accounting is not in accordance with generally accepted accounting principles. b. In the Accrual-Basis Accounting, expenses are recognized when incurred. c. In the Cash-Basis Accounting, Revenues recognized when cash is received. d. According to the GAAP in Accrual-Basis Accounting, companies recognize revenues when they record cash receipts for their services.arrow_forwardWhich of the following type of transaction will NOT cause a business cash inflow?A. decrease in assets other than cash.B. increase in liabilities.C. decrease in liabilities.D. increase in owner’s equity.arrow_forward
- Which of the following is not an example of a cash outflow? Select one: a. Purchase of inventory on credit b. pay employee wages and salaries c. cash withdrawal by the owner d. payment of income tax e. payment of accounts payablearrow_forwardWhich one of the following is NOT an example of cash flow from operating activities? Select one: a. Cash payment to suppliers for goods and services b. Cash receipts from the sale of goods and the rendering of services c. Cash payment of wages and salaries to employees d. Cash receipts from disposal of non-current assetsarrow_forwardWhen, at the end of an accounting period, cash has not been paid with respect to an expense that has been incurred, the business should then record: B . a prepaid expense, an assetarrow_forward
- Sales made to Ahmed on credit should be debited to? Select one: a. Cash A/C b. Account Receivable A/C c. Sales A/C d. Account Payable A/C hen the owner withdraws money from the business for personal use -Which of the following has correct effect on accounting equation? Select one: a. Expense increase and Cash decrease b. Cash increase and Capital increase c. Cash decrease and Capital decrease d. Income increase and Cash decreasearrow_forwardAll of the following are true regarding journal entries except? Select one: a. Journal entries provide account balances b. The debited account titles are listed first c. Journal entries show the effects of transactions d. Each journal entry should begin with a date When the owner withdraws money from the business for personal use -Which of the following has correct effect on accounting equation? Select one: a. Expense increase and Cash decrease b. Cash increase and Capital increase c. Cash decrease and Capital decrease d. Income increase and Cash decrease Sales made to Ahmed on credit should be debited to? Select one: a. Cash A/C b. Account Receivable A/C c. Sales A/C d. Account Payable A/C Which of the following is a correct form of the Accounting Equation? Select one: a. Assets = Liabilities + Capital b. Assets + Capital = Liabilities c. None of the above d. Assets + Liabilities = Capitalarrow_forwardWhen an account payable is paid with cash, the owner's equity in the business decreases. Please explain with full explanation a. True b. Falsearrow_forward
- An accounting trasaction simultaneously decreases assets and equity.This transaction is explained by which of the following scenarios: A.An expense was incurred on credit B.Accounts Payable owed were paid with cash C.An asset was purchased with cash D.The owner withdrew cash from the businessarrow_forwardAssume a company has a $350 credit (not cash) sale. How would the transaction appear if the business uses accrual accounting? A. $350 would show up on the balance sheet as a sale. B. $350 would show up on the income statement as a sale. C. $350 would show up on the statement of cash flows as a cash outflow. D. The transaction would not be reported because the cash was not exchanged.arrow_forwardWhat is the effect on the fundamental accounting equation if supplies are purchased on account? How will the fundamental accounting equation change if supplies are purchased with cash? Explain how this purchase will or will not change the owners equity.arrow_forward
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