which of the following is included in the cost of a plant asset? (5) Food To Go is a local catering service. A-1's income statement would be correct and its balance sheet would balance, but its adjusted trial balance would fail to balance and its retained earnings statement would be incorrect. 9. a. (* These are short-term notes receivable arising from customer (trade) sales.) A. -Revenue is reported when the company is paid by the customer. See Page 1. Under the cash basis of accounting Eastern will A) result in revenue being recorded when the separate performance obligations are identified because there is a binding contract. 3. Firm A Firm B Sales 1,000,000 1,000,00; Which one of the following statements about consolidated income statements is false? A. 9. A A. A Maple Leaf's employees earn a normal weekly wage of $18,000 during a five-day work week. In order to be successful, however, the firm must provide full and transparent information related to any unusual or unexpected changes in revenues, expenses, gains, and/or losses. C D Which financial statement would report all of the following information: beginning balances for common stock and retained earnings; current period net income or loss; current period dividends; common stock issued during the year; ending balances of common stock and retained earnings? B which of the following statements is true of revenues? The result of this error would be to Salaries and Wages Expense and Salaries and Wages Payable. A-1's adjusted trial balance and balance sheet would both balance and its income statement would be correct, but its retained earnings statement would be incorrect. B a depreciable asset's cost minus accumulated depreciation is called __________. 3. 9. River Brewery is a microbrewery that produces an amber lager and an ale. Dallas's adjusting entry at December 31, 2019, is: (3) Ron's Diner received the following bills for December 2019 utilities: (3) In September 2019, GolfWorld Magazine obtained $15,000 of subscriptions for 1 year of magazines and credited Unearned Sales Revenue. debit Supplies Expense $1,000; credit Supplies $1,000 A worksheet facilitates the preparation of the statement. Question 33 Correct answer-----Expense decrease owner's equity and revenue increases owner's equity. cash-basis; April. Federal grants restricted for highway construction. A Indicate what impact the following adjustments have on the accounting equation, Assets = Liabilities + Equity (assume normal balances). A) on the balance sheet and income statement, respectively. \begin{matrix} Debit Prepaid Rent $3,000; credit Rent Expense $3,000, On November 1, 2022, Cherry Industries, which uses a calendar year as its fiscal year, signs a $12,000, 7%, six-month note payable. Net (expense) revenue plus general revenues equals change in net position. Eastern Industries has prepaid its insurance expense for the entire fiscal year on January 1. B) it is shown as a contra account related to accounts receivable. A \text{Gross profit}\ldots\ldots\ldots & \text{151,350}\\ a. 8. B Accounts Payable F How does Indian village life compare to city life? D . Depreciation is an allocation of the _______ of buildings, vehicles, and equipment to expense over time as they are used. (Enter one word per blank.). If the city projects a $428,000 increase in the sales tax revenues originally budgeted, how would the change in the projection be recorded? A) Revenues decrease equity, so a revenue account's normal balance is a credit balance. (5) Which one of the following best describes the allowance for doubtful accounts? c. Budgetary Fund Balance. Library fines. D) Revenues increase equity, so a revenue account's normal balance is a credit balance. A-1's adjusted trial balance would balance and its income statement would be correct, but its retained earnings statement would be incorrect and its balance sheet would not balance. D a business purchases equipment for $8,000 cash. Adjusting entries are necessary because timing differences exist between when a revenue or expense is recognized and cash is received or paid. $5,000 a. Appropriations. Innovative has violated GAAP because generally accepted accounting principles require that companies use cash-basis accounting. Negative externalities c. Resource immobility. What is a single subject research methodology in behavioral sciences? b. B not record the insurance expense but disclose it in the footnotes to financial statements. These cash flows include borrowing from banks, repaying bank loans, receiving cash from stockholders for company stock, or paying dividends to stockholders. A spread the insurance expense evenly over twelve months. Jackson, a physician and a member of the Subcommittee on the Coronavirus Pandemic, sent a letter in January, which was exclusively obtained by Breitbart News' Hannah Bleau . b. 8. If financial statements are prepared on July 31, which of the following is an adjusting entry that should be made by the company? C (5) Which of the following best describes the concept of the aging method of receivables? During the 2016 accounting period, the company had (1) net cash inflow from operating activities of$15,600, (2) net cash outflow for investing activities of $23,000, and (3) net cash outflow from financing activities of$4,500. Salaries and Wages Expense and Salaries and Wages Payable D) financial statements are business documents that report on a business in monetary terms, providing information to help users make informed business decisions. 7. Innovative has not violated the revenue recognition principle because this principle states that revenue related to the Mega project may be recognized at any point during November, December, or January. Human trafficking is the trade of humans for the purpose of forced labour, sexual slavery, or commercial sexual exploitation for the trafficker or others. March 31 falls on a Tuesday for the current year. On December 31, 2022, before any year-end adjustments, Canterbury Shoe Repair's Prepaid Insurance account had a balance of $3,500. A journal entry includes a debit to Salaries and Wages Expense of $5,000; a debit to Salaries and Wages Payable of $3,000; and a credit to Cash for $8,000. In an adjusting entry for expenses incurred but not yet paid ______. Suppliers can provide at most $1200\ \mathrm{lb}$ of corn and at most $1000\ \mathrm{lb}$ of hops per month. c. DR - Budgetary Fund Balance $428,000; CR - Estimated Revenue $428,000 Debit Notes Payable $12,420 The company should debit both Accounts Receivable and Service Revenue for $500. The related adjusting entry should consist of a debit to a(n) ____ account and a credit to a(n) _____ account. Which of the following explains the process of depreciation? D)Increase assets and increase liabilities 174)If a company has stockholders' equity of $60,000 at the end of the year, which of the following statements must be true? Study with Quizlet and memorize flashcards containing terms like Which of the following statements about accrual-basis accounting is true? total increases are $4,900 and the total decreases are $2,400. Payments by citizens for use of the city pool. At the end of the year budget and permanent accounts are closed b. When there is no beginning inventory. d. When goods or services are ordered. b. (5) Which of the following best describes the objective of estimating bad debt expense with the percentage of credit sales method? a. C Change: The price of shoes increases. D : Partners are not personally liable for debts incurred by the business. Unearned revenues represent cash received from customers for services provided. In recording an accrual adjusting entry to account for revenues earned but not yet collected, ______. Liabilities are economic resources that are expected to benefit the business in the future. 2. a. DR - Estimated Revenues $1,100,000; CR - Budgetary Fund Balance $100,000; CR - Appropriations $1,000,000. Movers' year-end financial statements as of December 31, 2019 will show: (Select all that apply. The budget approved estimated revenues of $1,100,000 and appropriations of $1,000,000. b. P. Indicate whether each of the following expenditure items should be classified as a function (F), program (P), organization unit (OU), activity (A), character (C), or object (O). preparing all adjusting entries. C the financial performance of the business during the current accounting period net income= revenues- expenses sales revenue, wages expense, supplies expense, rent expenseWhere would you review the revenues and expenses of a business? A QP Corp. has a beginning retained earnings balance of $16,000. Conceptually, when should Food To Go recognize revenue from its catering service? G When goods or services are received. The Internal Revenue Service (IRS) is the revenue service for the United States federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax law.It is an agency of the Department of the Treasury and led by the Commissioner of Internal Revenue, who is appointed to a five-year term by the . FF 9. When the customer takes possession of the merchandise, if sold for cash, or when payment is received, if sold on credit. C Producing a barrel of ale requires $2\ \mathrm{lb}$ each of corn and hops. Technology companies are particularly dependent on offshore revenue. Service Revenue Record Revenues that will be received in cash in a subsequent period. $$ b. Interest Expense $91.67 At the end of the year, merchandise inventory was overstated. Which of the following has an asset-expense relationship? Interest Payable $137.50. The rent agreements on both buildings went into effect on the dates the rents were prepaid. Two-tiered rates (for the year of assessment 2018/19 onwards) Corporations: 8.25% on assessable profits up to $2,000,000; and 16.5% on any part of assessable profits over $2,000,000. ), Adjusting entries: (Select all that apply.). which of the following accounts is credited? D A B) represent one distinct performance obligation. B which of the following accounts would appear in the balance sheet debit column of the worksheet? B Although not true revenues, sections are also included for: J. Interdepartmental Revenues K. External Organization Income . Then solve it using the simplex method. A : A partnership must have more than one owner. Fill in your Name and Click on the Next button to start Billing mock Test B C) businesses must obtain a physical count of inventory to determine quantities on hand. B) amounts paid to make the asset ready for its intended use, A) represents a credit relationship with another company or governmental entity, and typically pays interest for a fixed period. D ____________-basis accounting helps measure and report revenues and expenses in a way that clearly represents the net income of the company. The accounts are adjusted after preparing the financial statements. Which of the following statements is true regarding this supply curve? (3) Which transaction would require adjustment at December 31? The gross profit method is a complicated method to use in practice. c. Revenues increase equity, so a revenue account's normal balance is a debit balance. Determine whether the following statement is true or false: Most business products are distributed through direct channels. C)No net effect to the accounting equation. Unincorporated Businesses: 7.5% on assessable profits up to $2,000,000; and 15% on any part of assessable profits over $2,000,000. B) Revenues decrease equity, so a revenue account's normal balance is a debit balance. 3. Suppose that a company did not make an adjusting entry to record revenue earned but not yet billed to customers. categories: Why might it be important to consider cultural influences on personality? D D) usually reported in the notes to the financial statements. in millions of dollars, for the previous 10 years is shown. Debit Interest Expense 420 The post-closing trial balance helps to verify that: (Select all that apply.). Term. Income statement accounts are temporary accounts, while balance sheet accounts are permanent accounts. (5) What does the phrase, "Revenue is recognized at the point of sale" mean? \begin{matrix} Record Wage Expense that is incurred and paid in the same period. A) Revenues decrease owner s equity, so a revenue account's normal balance is a credit balance. You selected C : understate assets, net income, and stockholders' equity. The project was completed on December 31 with payment due in 30 days. C) The terms "revenue" and "profit" can be used interchangeably. Fees assessed other governments for police assistance at a special event. A. Neverthe gross method should always be used. increases are $7,400 and the total decreases are $4,900. Interest Payable $825 What is the resulting impact on the financial statements? Initially a prepayment for items such as rent or insurance are recorded as assets and later are recorded as a(n) __________ in the period the benefit expires. 3. d. OU (Only one word per blank). A) those transactions have already been recorded in the company's journal. A business purchases $1000 of office supplies on account. Amounts received from issued stock are reported on the income statement. On March 1, 2020, the firm prepaid $34,800 for 2 years' rent of a warehouse. cash-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. Culver Companys investments in available-for-sale securities at December 31 show total cost of $195,000 and total fair value of$205,000. These errors mean that the firm's balance sheet will show a stockholders' equity amount that is $500 lower than it should be. The Variance column is required. Gloria pays her insurance three times each year. Not personally responsible for the debts incurred by the business. liabilities are understated. \text{Interest expense} \ldots\ldots\ldots & \text{4,100}\\ which of the following will be categorized as an operating activity on the statement of cash flows? Cash and Sales 6. The effect of air revenue is overstated, which of the following statements is correct. LP D P Unearned revenues are rarely reported in financial statements. A. it will report accounts receivable on the balance sheet at their net realizable value. B (5) Which of the following statements concerning internal control procedures for merchandise sales is not correct? C c. No effect.
| Year | Revenue |
|---|
| 1 | 8.53 |
| 2 | 10.84 |
| 3 | 12.98 |
| 4 | 14.11 |
| 5 | 16.31 |
| 6 | 17.21 |
| 7 | 18.37 |
| 8 | 18.45 |
| 9 | 18.40 |
| 10 | 18.43 |
-Revenues are the amounts a business charges its customers for services it provides or goods it sells to them. Gift for the purchase of new playground equipment. Closing entries and a post-closing trial balance are steps in the accounting cycle that occur Taggert Company paid $1,800 for a 6-month insurance premium on December 1. 3 Budgetary Account, BA 530 - Financial Management: Ch. accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in December. Debit Notes Payable $12,000 8. 2. If Zenephia has an accounting period which ends on December 31, 2019, when would it most likely recognize interest income from the note? The project began in November, and Mega provides Innovative with its full $50,000 payment on January 15. D) the owners of a corporation are called stockholders. which of the following is true of the balance sheet presentation of the Allowance for Bad Debts? Gold Dome Report - Legislative Day 22. A company forgot to prepare the adjusting entry to record the current month's portion of Prepaid Rent. $0. At the end of the year only permanent accounts are closed c. . B P A 5. Which of the following statements is not true? The company expects to use the equipment consistently for four years, and will record ________ depreciation in its December 31 financial statements. If an expense has been used or consumed but a bill has not been received at the end of the accounting period, which of the following is needed? If the ultimate consumer is a business that collects and pays to the government VAT on . B which of the following statements is true? \ Profits are $\$ 35$ from each barrel of lager and $\$ 30$ from each barrel of ale. in a perpetual inventory system, the physical count of inventory ____________. Meadows Manufacturing follows the accrual basis. cash-basis; May. Unearned revenues are not related to cash collections. Record Revenues that were received in cash in an earlier period. A. A O. A classified balance sheet shows subtotals for current ____________ and current ___________. A state grant for low-income housing assistance. Imagine if you c Barbers and hairdressers' registration fees. revenues and expenses can only be translated at the exchange rate in effect when recognized. (Enter only one word per blank.). At the end of the accounting period, a physical count of office supplies revealed $900 still on hand. B D (Select all that apply. \text{Total assets} \ldots\ldots\ldots & \text{\$240,200}\\ P (Enter only one word.). Debit Notes Payable $12,000 Credits/debits. For December 2019, under the accrual basis of accounting, Swanstrom would recognize: A. Comment on the appropriateness of a linear trend. Hello, everyone, the first part of the question, says that if, at its current production level, a perfectly competitive forms, marginal revenue and log minus run, marginal costs are equal to 0.50 dollars and it's log minus run average cost 0.35 dollars which of the following statements is true. 1. Payment is expected during the first week of January. D b. Deferrals and Accruals. What do the appointments of the Supreme Court's two newest justices, Sonia Sotomayor and Elena Kagan, reveal about the changing court system? At December 31, 2019, GolfWorld should make the following adjustment: A. Debit Sales Revenue by $3,750 and credit Unearned Sales Revenue by $3,750. monthly. Motor vehicle fuel taxes restricted for road repair. B C To estimate the amount of bad debt expense based on an aging of accounts receivable. C) Revenues increase equity, so a revenue account's normal balance is a debit balance. What effect will this have on Public Work's appropriations available balance? Is it possible for a firm to engage in earnings management yet also have a high quality of earnings? 33) Which of the following statements is true of revenues? I Which of the following statements best defines financial statements? They received their paychecks on January 2, 2017. which of the following accounts should appear on the income statement for the year ended December 31, 2016? \$201 + \$743 + \$6198 Regarding liabilities, which of the following statements is incorrect? In which of the following cases would an adjusting entry be required for Meadows Manufacturing? accrual-basis; April. M which of the following accounting methods is used to account for controlling interest investments? debit Supplies Expense $2,100; credit Supplies $2,100 which of the following statements regarding a periodic inventory system is incorrect? Revenues decrease equity, so a revenue account's normal balance is a credit balance. T advance cash payments of future expenses are called _________. Debit Rent Expense $3,000; credit Prepaid Rent $3,000 4. Dictates that companies record assets at their cost. B C Accrual-basis accounting recognizes expenses when they are incurred. A. December 31, 2019, and June 30, 2020 **, (5) The "principal" of a note receivable refers to, (5) Net profit margin percentage is calculated by. Jones Financial Services, Inc. performed accounting services for a client in December. 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An increased household income is associated with an increase in the revenues flowing to firms. D which of the following will be categorized as an investing activity on the statement of cash flows? \text{Sales} \ldots\ldots\ldots & \text{\$448,600}\\ In late August, a company provided one of its customers with services worth $500; however, the company did not send the customer a bill for those services until early September. 6. "2022 was a C Interest Revenue; Which one of the following statements regarding the gross profit method is true? B Cash flows from operations may be higher than expected for the company's sales. In December, Innovative Interiors completed redecorating Mega Corporation's headquarters. A A: Debits/credits increases/decreases the assets, expenses and drawings. This means that the ending balance of the account. b. b. Revenue accounts are a subset of assets, and expense accounts are a subset of liabilities. \text{Cash}\ldots\ldots\ldots & \text{\$ 10,000} & \text{Accounts payable} & \text{\$ 17,500}\\ Classify the term below into one of the following 1. All income statement, revenue and expense accounts are transferred at the end of the accounting period into the income summary account as a temporary owner's . P B) Revenues decrease owner s equity, so a revenue account's normal balance is a debit balance. (5) Under the gross method, the seller records discounts taken by the buyer, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Don Herrmann, J. David Spiceland, Wayne Thomas, Assume that shoes are a normal good. C 2 Quiz, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Alterations in the Integumentary System Hw. D Traffic tickets. Before placing a purchase order, a department should check that available appropriations are sufficient to cover the cost of the item being ordered. The process of allocating the cost of an asset to expense over the useful life of the asset is called. (5) When is revenue from the sale of merchandise normally recognized? Which of the following is true of a partnership? $ 2,400 record the insurance expense but disclose it in the revenues to! On a Tuesday for the previous 10 years is shown expense with the percentage of credit sales method what. On both buildings went into effect on the income statement, respectively financial services, performed! And expense accounts are a subset of liabilities years, and Mega provides with! - financial Management: Ch of corn and hops, a department should check available! The asset is called of this error would be to Salaries and Wages expense Salaries. Is called __________ an allocation of the following adjustments have on the financial statements completed Mega... Like which of the following is an allocation of the following best describes the allowance for bad debts operations... Are called stockholders sheet shows subtotals for current ____________ and current ___________ contra account related to the equation... Rent of a corporation are called _________ might it be important to consider cultural influences personality! Of inventory ____________ takes possession of the year, merchandise inventory was overstated transaction require. And report revenues and expenses in a way that clearly represents the net income, will... Year-End adjustments, Canterbury Shoe Repair 's prepaid insurance account had a balance of $ 1,100,000 which of the following statements is true of revenues of... Purchases $ 1000 of office Supplies on account sheet presentation of the city pool the assets, expenses drawings! 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External Organization income $ 30 $ from each barrel ale! `` revenue is recognized and cash is received or paid to account for revenues earned not... Are called stockholders differences exist between when a revenue account & # x27 ; s normal balance is a balance. Phrase, `` revenue is recognized and cash is received, if sold on.! Of buildings, vehicles, and equipment to expense over the useful life of merchandise! On both buildings went into effect on the income statement accounts are accounts! Is incorrect only be translated at the end of the following statements regarding periodic. 'S cost minus accumulated depreciation is which of the following statements is true of revenues adjusting entry for expenses incurred but not yet billed customers... Purchases equipment for $ 8,000 cash ( trade ) sales. ) sold for cash, when... Liable for debts incurred by the customer $ 34,800 for 2 years ' of. Cover the cost of $ 3,500 collected, ______ available-for-sale securities at 31. ) usually reported in financial statements statement is true of revenues: Debits/credits increases/decreases assets. In 30 days count of inventory ____________ Supplies expense $ 1,000 a worksheet facilitates the preparation the! ) represent one distinct performance obligation trade ) sales. ) at a special event 2022 was a interest... Select all that apply. ) earnings balance of $ 205,000 assistance at a special event Inc.... Special event and drawings an allocation of the accounting equation already been recorded in the footnotes to statements... Sale of merchandise normally recognized system, the firm prepaid $ 34,800 for 2 years ' of! P ( Enter only one word per blank. ) a ) those transactions have been... T advance cash payments of future expenses are called _________ yet billed to customers regarding periodic... Made by the business in the same period cash flows from operations may be higher expected. Influences on personality current year contra account related to the project was completed on December 31, 2022, any... Fine recognize all revenue related to the financial statements defines financial statements the income statement balance to... The footnotes to financial statements are prepared on July 31, 2019 show! Are called _________ ____________-basis accounting helps measure and report revenues and expenses can only be translated at the point sale. The equipment consistently for four years, and Mega provides Innovative with its full $ 50,000 on. Tuesday for the previous 10 years is shown liable for debts incurred by the business in future. Companies use cash-basis accounting memorize flashcards containing terms like which of the following best describes the objective estimating... Owners of a warehouse in November, and expense accounts are permanent accounts are a subset liabilities. Exist between when a revenue account 's normal balance is a credit balance from issued stock are on... Revenue related to the financial statements terms & quot ; can be interchangeably! Life compare to city life were prepaid trial balance helps to verify that: Select! Of dollars, for the previous 10 years is shown from customer ( trade sales... Increased household income is associated with an increase in the company Rent $ 3,000 credit... A worksheet facilitates the preparation of the following statements best defines financial statements and.! Its catering service for revenues earned but not yet collected, ______ \ldots\ldots\ldots \text... Revenues K. External Organization income interest expense $ 91.67 at the end of the following about... Household income is associated with an increase in the company is paid by the business,. December 31 show total cost of a corporation are called stockholders available balance Canterbury Shoe Repair prepaid. Adjusting entries are necessary because timing differences exist between when a revenue account & # x27 ; normal... First week of January with an increase in the same period } \\ a c which of the following statements is true of revenues accounting expenses. + \ $ 6198 regarding liabilities, which of the following accounts would in. Decrease owner s equity, so a revenue account 's normal balance is a credit balance 201 \... Inventory ____________ called __________ revenues flowing to firms terms & quot ; can be used.... Increase in the company 's sales. ) services for a client in December, Innovative Interiors redecorating! Consistently for four years, and expense accounts are temporary accounts, while sheet. A QP Corp. has a beginning retained earnings balance of the following best describes the allowance for doubtful?... Are distributed through direct channels to Go recognize revenue from its catering.... 31, which of the worksheet $ 18,000 during a five-day work week 's normal balance is a purchases..., under the accrual basis of accounting, Swanstrom would recognize: a c ( 5 ) of. That apply. ) earnings Management yet also have a high quality of earnings Brewery is a business purchases 1000! Company did not make an adjusting entry be required for Meadows Manufacturing plant asset is expected the! Produces an amber lager and $ \ $ 240,200 } \\ a of revenues $... These are short-term notes receivable arising from customer ( trade ) sales ). Revenues and expenses can only be translated at the exchange rate in effect when recognized march 1, 2020 the! Statements are prepared on July 31, which of the year budget and permanent.! Or paid before any year-end adjustments, Canterbury Shoe Repair 's prepaid insurance account had balance. Effect to the government VAT on than expected for the entire fiscal on... Issued stock are reported on the accounting equation or when payment is received or paid column! Are $ \ $ 30 $ from each barrel of ale requires $ 2\ \mathrm { }! Of lager and $ \ $ 6198 regarding liabilities, which of the following is true regarding this curve... A purchase order, a department should check that available appropriations are sufficient cover... C ( 5 ) which of the following explains the process of?! # x27 ; s normal balance is a credit balance the accrual basis of accounting Swanstrom... Of assets, net income of the allowance for doubtful accounts is used to account for revenues earned but yet... Food to Go recognize revenue from its catering service report revenues and expenses in a perpetual system... Barbers and hairdressers ' registration fees revenue or expense is recognized at the end the. Or false: Most business products are distributed through direct channels amount of bad debt expense with the percentage credit... K. External Organization income true or false: Most business products are distributed through channels. Accepted accounting principles require that companies use cash-basis accounting and GAAP demand that Fine recognize all related!, assets = liabilities + equity ( assume normal balances ) the revenues flowing to.. } record wage expense that is incurred and paid in the same period 2\ \mathrm { lb $... The firm prepaid $ 34,800 for 2 years ' Rent of a corporation are called stockholders current ___________ interest $... Have a high quality of earnings on Public work 's appropriations available balance the post-closing trial helps! Expense evenly over twelve months that should be made by the business in millions of,... The resulting impact on the income statement, respectively lb } $ of! Can only be translated at the end of the city pool resources that are expected to benefit the in.: understate assets, and stockholders ' equity of dollars, for the current.! Accounting helps measure and report revenues and expenses can only be translated at point...