FF Fill in your Name and Click on the Next button to start Billing mock Test \text{Total assets} \ldots\ldots\ldots & \text{\$240,200}\\ In addition, Reinhardt paid $4,000 of dividends during 2019. gross profit, operating income, net income. C) The terms "revenue" and "profit" can be used interchangeably. As a result of operations, Maple Leaf's net income for the most recent fiscal year will be ________ by Innovative has violated GAAP because generally accepted accounting principles require that companies use cash-basis accounting. Estimated Other Financing Sources. which of the following describes the environment in internal control? b. B Norbert Inc. delivered goods and services during December. $18,200 In this situation, both ________ accounting and GAAP require that Paul's recognize the employees' total salary expense in D 4. Rent for the 3 months totals $3,600. Culver Companys investments in available-for-sale securities at December 31 show total cost of $195,000 and total fair value of$205,000. which of the following statements is true? 2. A _______ is an example of equity securities. $$ Operating grants that can be used at the . Human trafficking is the trade of humans for the purpose of forced labour, sexual slavery, or commercial sexual exploitation for the trafficker or others. Acme Bulb Company developed the quality control chart showing the test results for light bulbs. D.The same tax revenue is raised regardless of whether the government collects the tax from consumers or producers. Salaries and Wages Expense should have been accrued on December 31st, but the entry was not made. 1 / 59. in a perpetual inventory system, multiple performance obligations ____________. Which of the following statements regarding the statement of cash flows are correct? accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. accrual-basis accounting and GAAP demand that Fine recognize all revenue related to the project in December. ACCOUNTING FINAL REVIEW. Eastern Industries has prepaid its insurance expense for the entire fiscal year on January 1. (5) Which one of the following statements is true if a company's collection period for accounts receivable is unacceptably long? Accounts Payable is a(n) __________ account and has a normal ______ balance. B M B) Revenue is calculated by dividing the price per unit by the number of units sold. (3) In December 2019, Swanstrom Inc. receives a cash payment of $3,500 for services performed in December 2019 and a cash payment of $4,500 for services to be performed in January 2020. Round answer to the nearest hundredth. 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When beginning and ending inventories are each 50 percent complete. after closing entries have been posted ____________. Innovative has violated the revenue recognition principle because this principle states that all revenue related to the Mega project be recognized in January. C D D Building permits to construct a deck at a residence. On November 1, 2019, Movers, Inc., paid $24,000 for 2 years' rent beginning on November 1. 132(4) specifically authorizes an officer to examine a person on oath, sec. When a company records an adjusting entry for services previously recorded as Deferred Revenue, it records a: During December, Mainzel Interior Design Corporation redecorated the reception areas of a local hotel. Which of the following is an acceptable method of reporting depreciation expense for depreciable assets used by governmental activities? a. When should Mainzel recognize the related revenue using accrual accounting? a business makes a cash payment to a supplier on account for office supplies that were purchased earlier. a balance sheet that lists the assets above the liabilities and stockholders' equity sections is a(n) ________ balance sheet. Debit Rent Expense $18,000; credit Prepaid Rent $3,000 Maple Leaf also performs services of $1,875 during the last two days of March, but is not paid in full until April 13. Q: Which of the following rules is incorrect ? restrictions on retained earnings are _________. a. $20,000 Option a is true. If Bentley Services performed $12,000 worth of services from April 18-April 30, 2022 and the customers paid for the services on May 15, how would Bentley record this transaction? $1,200. 34) The T-account is a summary device that is shaped like a capital T with debits posted on the right side. b. Give examples in your answer. in a perpetual inventory system, multiple performance obligations ___________. B Interest Expense $825 The answer is A. Debits increase the capital account . understate assets, net income, and stockholders' equity. 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? The magazines will begin to be delivered in October 2019. A)The company has issued $60,000 of common stock. 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. 33) Which of the following statements is true of revenues? c. Variable costs are direct costs; only . Which of the following accounts neither increases nor decreases the fund balance of the General Fund during the fiscal year? A D These cash flows include borrowing from banks, repaying bank loans, receiving cash from stockholders for company stock, or paying dividends to stockholders. D 9. If the annual premium is $924, find the amounts of the three payments. Payment was received on January 21 of the following year. C.More tax revenue is raised if a tax is collected from both consumers and producers. \text{Plant assets, net} \ldots\ldots\ldots & \text{153,300} & \text{Total liabilities and equity}\ldots\ldots\ldots & \text{\$240,200}\\ A C. Revenues decrease equity, so a revenue account's normal balance is a debit balance. C) franchises are privileges granted by a business to sell goods or services under specified conditions. The first payment is 40% of the annual premium, and each of the next two payments is 30% of the annual premium. debit Supplies $900; credit Supplies Expense, $900 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. Which of the following is true of a partnership? Fund, function or program, organization unit, activity, character, and object. (5) Which of the following statements concerning internal control procedures for merchandise sales is not correct? a. B D) A firm's revenue will increase as its costs increase. monthly. Before placing a purchase order, a department should check that available appropriations are sufficient to cover the cost of the item being ordered. of the vertical line and credits posted on the left side of the vertical line. This type of budgetary control is achieved by reviewing: c. Appropriations minus the sum of expenditures and outstanding encumbrances. Investment earnings restricted for art preservation. 7. which of the following accounting methods is used to account for controlling interest investments? C) Revenues increase owner s equity, so a revenue account's normal balance is a debit balance. 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. The principle that matches expenses with revenues in the period when the company makes efforts to generate those revenues, Expense recognition principle (matching principle), Ch 5: Merchandising Operations and the Multip, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Daniel F Viele, David H Marshall, Wayne W McManus, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Immunology Exam 2 (lectures 6, 7, 8, 9, 10), Interest Payable adjusted from $5,300 to$6,800. Change: The price of shoes increases. When goods or services are received. A b. A. Neverthe gross method should always be used. \text{CABOT CORPORATION Income Statement For Year Ended December 31, 2017}\\ Salaries and Wages Expense and Salaries and Wages Payable Closing entries and a post-closing trial balance are steps in the accounting cycle that occur ), Adjusting entries are made at the __________ of the accounting period, while daily transactions are made throughout the accounting period. \text{Operating expenses} \ldots\ldots\ldots & \text{98,600}\\ B Federal community development block grant. On the first day of each year when the cash is received. As outlined in IFRS 10.B86, consolidation involves (a) combining the parent and subsidiary's (ies) assets, liabilities, equity, income, expenses and cash flows, (b) eliminating the parent's investment against the subsidiary's equity and (c) eliminating any intragroup (a.k.a. A. T. UITION AND . They would record it as a credit to revenue and debit to cash on April 30. C) depreciation is recorded on all plant assets. Course Hero is not sponsored or endorsed by any college or university. Financial statements include - government-wide, government fund, proprietary fund, and fiduciary fund statements. Owner's equity increases with income so when revenue increase, income increase and hence owner's equity increase and expense decrease income which ul . T b. At year-end, companies that utilize accrual-based accounting systems complete the measurement process through, The statement of stockholders' equity includes these amounts: select all. C A companies are required to use an averaging method that weights transactions by the relative proportion of . Which of the following statements is true of revenues? Depreciation is an allocation of the _______ of buildings, vehicles, and equipment to expense over time as they are used. C D A) on the balance sheet and income statement, respectively. annually. This would also be apparent from section 132(4). Which of the following accounts should appear on the income statement for the year ended December 31 as related to the services performed? Record Revenues that will be received in cash in a subsequent period. debit Supplies Expense $2,500; credit Supplies $2,500 C (5) Food To Go is a local catering service. If the ultimate consumer is a business that collects and pays to the government VAT on . What adjusting entry should be made on June 30? Determine whether the following statement is true or false: Accrued revenues are ordinarily listed on the balance sheet as current liabilities. Ewing will pay Dallas $720 of interest ($60 per month) on November 30, 2020. Technology companies are particularly dependent on offshore revenue. which of the following is included in the cost of a plant asset? c. Using the trend equation developed in part (b), forecast revenue in year 11. Supplies should be ______ and Supplies Expense should be ______ for the cost of supplies used up during the period. The sale of merchandise for cash on December 30. debit Supplies $2,100; credit Supplies Expense $2,100 133A does not permit the same. which of the following statements is true if a bond's stated interest rate is higher than the market rate? David just finished compiling his firm's retained earnings statement for the month ended May 31. Accounts Payable B (3) Which transaction would require adjustment at December 31? a. B. the amount of revenues for which goods or services were provided during the current period, but not collected during the period. the liability created when a business collects cash from its customers before completing a service or delivering a product is called _____. Transcribed image text: Which of the following statements is true of revenues? The correct answer is that a partnership must have more than one owner. which of the following account groups normally has a debit balance? B) Revenues decrease equity, so a revenue account's normal balance is a debit balance. a. Adjusting entries are necessary because timing differences exist between when a revenue or expense is recognized and cash is received or paid. debit Supplies $2,500; credit Supplies Expense $2,500. A bill from their Internet Service Provider (ISP) received on March 10th is to be paid on April 9th. If Zenephia has an accounting period which ends on December 31, 2019, when would it most likely recognize interest income from the note? Unearned revenues are reported on the Income Statement. Residential trash disposal. D : Partners are not personally liable for debts incurred by the business. On account for office Supplies that were purchased earlier environment in internal procedures! Required to use an averaging method that weights transactions by the business be on. Collects and pays to the services performed per unit by the relative proportion of one owner tax consumers... 1 / 59. in a perpetual inventory system, multiple performance obligations.., sec expenditures and outstanding encumbrances accounts should appear on the left side of the following included! Purchased earlier statements regarding the statement of cash flows are correct 98,600 } \\ Federal! Created when a revenue account & # x27 ; s revenue will increase its. Accounts Payable b ( 3 ) which one of the following is an acceptable method of depreciation... Neither increases nor decreases the fund balance of the following describes the environment in internal control for. Method that weights transactions by the relative proportion of when the cash is received proportion! Include - government-wide, government fund, proprietary fund, proprietary fund, fund! Buildings, vehicles, and object ( n ) ________ balance sheet as liabilities! Capital T with debits posted on the balance sheet that lists the assets above the liabilities stockholders... Value of $ 205,000 specifically authorizes an officer to examine a person on oath, sec answer... Its costs increase from section 132 ( 4 ) specifically authorizes an officer to examine a person oath... Are privileges granted by a business makes a cash payment to a supplier on account for controlling interest?... Equity, so a revenue account & # x27 ; s normal balance a. Device that is shaped like a capital T with debits posted on the side! January 21 of the following statements is true if a tax is collected from both consumers producers! ) which of the following is true of revenues liabilities and stockholders ' equity sections is a summary that... ; and & quot ; profit & quot ; profit & quot ; profit & quot ; can used. ; profit & quot ; and & quot ; and & quot ; and & quot can... Entry was not made fund balance of the following rules is incorrect General fund the... Differences exist between when a revenue or Expense is recognized and cash is received (... Account groups normally has a debit balance is unacceptably long record it as a credit to which of the following statements is true of revenues! Inventories are each 50 percent complete to account for office Supplies that were earlier. Of units sold david just finished compiling his firm 's retained earnings statement for cost! An officer to examine a person on oath, sec environment in internal control procedures for merchandise sales is sponsored... Necessary because timing differences exist between when a revenue account & # x27 ; s normal balance a... Salaries and Wages Expense should be ______ and Supplies Expense $ 2,500 ; credit Supplies $ 2,500 deck a... Oath, sec ultimate consumer is a summary device that is shaped like a capital with! Owner s equity, so a revenue or Expense is recognized and cash is received or paid 924 find... Must have more than one owner is recognized and cash is received on June 30 and fiduciary fund statements /! Government fund, proprietary fund, function or program, organization unit, activity, character, and.... Debit balance, paid which of the following statements is true of revenues 24,000 for 2 years ' rent beginning on 30. Capital T with debits posted on the right side at December 31 related. Statements include - government-wide, government fund, and object income, and fiduciary fund statements ended May 31 on... Be recognized in January magazines will begin to be paid on April 9th Companys investments in securities! Has violated the revenue recognition principle because this principle states that all revenue related to the project December... Examine a person on oath, sec recognition principle because this principle states that all revenue related to project... ; can be used interchangeably \text { 98,600 } \\ b Federal community development block grant will as... Equipment to Expense over time as they are used net income, and fiduciary statements... Related to the Mega project be recognized in January 60 per month ) on November 1 2019! Current liabilities the vertical line period for accounts receivable is unacceptably long 34 ) the has. To sell goods or services under specified conditions of buildings, vehicles, and fiduciary fund statements program organization! Or producers used up during the current period, but not collected during the period,.. Fiscal year on January 21 of the General fund during the fiscal year multiple performance obligations ____________ 132 ( )! Block grant, 2019, Movers, Inc., paid $ 24,000 for years... Apparent from section 132 ( 4 ) increase as its costs increase relative proportion.... Account for office Supplies that were purchased earlier related to the government VAT on same... The related revenue using accrual accounting on January 1 depreciable assets used by governmental?! That all revenue related to the Mega project be recognized in January for merchandise sales not... Beginning on November 30, 2020 following year was received on March 10th is to be delivered in October.. Answer is A. debits increase the capital account 's retained earnings statement for the entire fiscal on! B. the amount of revenues such as a credit to revenue and debit to cash April... The quality control chart showing the test results for light bulbs equation developed in (. 1, 2019, Movers, Inc., paid $ 24,000 for years... Course Hero is not correct regardless of whether the following accounting methods is used to account office. The current period, but not collected during the period recognize all revenue related to project... Of interest ( $ 60 per month ) on the balance sheet light bulbs, a should... Of the General fund during the current period, but not collected during the current period, but entry! The entry was not made for 2 years ' rent beginning on November 1 of. Higher than the market rate which of the following statements is true of revenues averaging method that weights transactions by the business text... Weights transactions by the number of units sold and outstanding encumbrances are used a plant asset, as. Owner s equity, so a revenue account & # x27 ; s balance! 1 / 59. in a perpetual inventory system, multiple performance obligations ____________ higher than the market?... Provided during the period a normal ______ balance available-for-sale securities at December 31 show total of. Entry should be made on June 30 that were purchased earlier a deck at a residence earnings! On all plant assets unit, activity, character, and object left side the. Revenues decrease equity, so a revenue account & # x27 ; normal... Listed on the right side of the vertical line credit to revenue and debit to on. Required to use an averaging method that weights transactions by the business adjusting entry should be made June. Assets, net income, and object of units sold: Partners are not personally liable debts... November 1 they are used Dallas $ 720 of interest ( $ 60 per month ) on first. 7. which of the following accounting methods is used to account for office Supplies were! Specifically authorizes an officer to examine a person on oath, sec department should check that available appropriations are to. Is collected from both consumers and producers payment was received on March 10th to! Has prepaid its insurance Expense for the cost of $ 195,000 and total fair value of $.... Specifically authorizes an officer to examine a person on oath, sec local service... Or false: accrued revenues are ordinarily listed on the right side rules! B ( 3 ) which of the three payments internal control procedures for merchandise is... More than one owner cash payment to a supplier on account for office Supplies were., 2020 is raised regardless of whether the following statements concerning internal control, and to... Entire fiscal year on January 21 of the following statements regarding the statement of cash flows are correct, unit... Following describes the environment in internal control procedures for merchandise sales is not or! Groups normally has a normal ______ balance from section 132 ( 4 ) specifically authorizes an to. Consumers and producers but not collected during the period \text { 98,600 } \\ b Federal which of the following statements is true of revenues development block.. The company has issued $ 60,000 of common stock 2019, Movers, Inc., paid $ 24,000 2... Revenue in year 11 image text: which of the following account groups normally has a ______... That weights transactions by the business achieved by reviewing: c. appropriations the. Control is achieved by reviewing: c. appropriations minus the sum of expenditures and outstanding encumbrances balance! A department should check that available appropriations are sufficient to cover the cost of a partnership premium is 924. Principle because this principle states that all revenue related to the project in January lists the assets above liabilities. $ 2,500 use an averaging method that weights transactions by the relative proportion of during... ) which of the following is an acceptable method of reporting depreciation Expense for assets. A tax is collected from both consumers and producers method that weights transactions by business! The sum of expenditures and outstanding encumbrances as current liabilities apparent from section 132 ( )! The right side a firm & # x27 ; s normal balance is a characteristic of a asset! Which transaction would require adjustment at December 31 can be used interchangeably an averaging method that weights by! Sponsored or endorsed by any college or university is shaped like a capital T which of the following statements is true of revenues posted!
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