APTERS 1-4 Name: 17. The is where can ID: A a. chart of accounts b. income state
ID: 2557175 • Letter: A
Question
APTERS 1-4 Name: 17. The is where can ID: A a. chart of accounts b. income statement c. balance sheet d. journal a transaction can first be found on the accounting reconds. 18. Which of the following is pet a short-cut in finding ermors ont a. Determine the difference between debits and credias and look for the amount the trial bolance? amount and change any account to make the trial balance correct Determine the difference between debits and credits, divide the amount by 2, look for the amount. Determine the difference between debits and credits, divide the amount by 9,if it evenly, look for a transposition or slide error. c. d. divides 19. Adjusting entries are a. b. e. d. the same as correcting entries needed to bring accounts up to date and match revenue and expense optional under generally accepted accounting principles rarely needed in large companies is a. debit Insurance Expense, $1,380 and credit Prepaid Insurance, $1,380. b. debit Insurance Expense, $1,150 and credit Prepaid Insurance, $1,150. c. debit Insurance Expense, $1,610, and credit Prepaid Insurance, $1,610. d. debit Prepaid Insurance, $1,380, and credit Cash, $1,380. Which of the following pairs of accounts could pot appcar in the same adjusting entry? a. Service Revenue and Uncarned Revenue b. Interest Income and Interest Expense c. Rent Expense and Prepaid Rent d. Salaries Payable and Salaries Expense 21. 22. All of the following statements regarding vertical analysis are true exceps Vertical analysis may be prepared for several periods to analyze changes in relationships a. mi atielart over time. b. Jn a vegtical analyis of a balance hest assets c. In a vertical analysis of an income statement, each item is stated as a percent of tot expenses d. Major differences between a company's vertical analysis and industry averages should be investigated. accounts will be closed to the Capital account at the end of the fiscal year? Which of the following a. Rent Expense b. Fees Eamed c. Income Summary d. Depreciation Expense 23.Explanation / Answer
Note: As per rule, I am answering first 4 questions.
Question- 17;
Answer is option (d). Journal
Explanation;
Journal is primary accounting document in which transactions are first recorded, after this transactions are recorded in chart of accounts. Income statement and balance sheet is prepared after adjusted trial balance. Hence other options are incorrect. Thus answer is oprion (d). Journal.
Question- 18;
Answer is option (b). Determine the amount and change any account to make the trial balance correct.
Explanation;
Except option (b) all other options are the short-cut in finding errors on the trial balance. Because option (a), (c) and (d) are the basis for finding out errors on the trial balance.
As we know that changing any account is not a way of finding out the error on trial balance.
Question – 19;
Answer is option (b). Needed to bring accounts up to date and match revenue and expense.
Explanation;
Adjusting entries are those journal entries which are required to update revenue, expense, asset, and liability accounts as as per the accrual basis of accounting. Hence option (b) is corect answer.
Question – 20;
Answer is option (C). Debit insurance expense, $1610 and credit prepaid insurance, $1610
Explanation;
Insurance policy is purchased on June 1, for $2760 hence on December 31, total 7 months are passed hence insurance expense for these 7 months will be recognized as insurance expense.
($2760 * 7 / 12) = $1610
Hence adjusting entry for consumed insurance expense will be as follow;
Debit……….Insurance expense by $1610
Credit………Prepaid insurance by $1610