Ask Question, Ask an Expert


Ask Financial Accounting Expert

problem: Which of the following statements about accrual basis accounting is true?

a) Accrual basis accounting is used only by small hospitality businesses.
b) Accrual basis accounting is reflected on the statement of cash flows.
c) Accrual basis accounting generally requires that several adjusting entries be recorded at the end of the accounting period.
d) Accrual basis accounting allows a business to show greater profits than cash basis accounting.

problem: A meeting planner made a deposit with a hotel to reserve exhibit space and the hotel has hosted the meeting. Now that the meeting has taken place, accountants should make an adjustment:

a) To record liabilities and expenses not previously recorded.
b) To record assets and revenues not previously provided.
c) In which previously recorded liabilities become revenue.
d) In which previously recorded assets become expenses.

problem: Which of the following is an ex of an accounting adjustment in which previously recorded assets become expenses?

a) Prepaid Insurance decreases and Insurance Expense decreases.
b) Prepaid Rent decreases and Rent Expense increases.
c) Utilities Payable increases and Utilities Expense increases.
d) Depreciation Expense increases and Accumulated Depreciation, Building increases.

problem: Which of the following adjustments is an ex of an accrual adjustment?

a) A liability/expense adjustment involving utility expenses
b) An asset/expense adjustment involving depreciation
c) A liability/revenue adjustment involving unearned revenues
d) An asset/expense adjustment involving insurance

problem: Accounts that record accumulated depreciation are shown on the:

a) Balance sheet as deductions from assets.
b) Income statement as deductions from liabilities.
c) Statement of cash flows as revenue.
d) Income statement as increases to expenses.

problem: James Bell plans to stay at the Michaels Motel for one month, and he prepays his room charges. Bell arrives and begins his stay on January 21. To account for Bell's prepayment, at the end of January (the end of the accounting period) the motel accountant should:

a) Debit Unearned Room Revenue and credit Room Revenue.
b) Credit Room Revenue and debit Cash.
c) Credit Accounts Receivable and debit Cash.
d) Debit Unearned Room Revenue and credit Cash.

problem: Accounting adjustments to account for unpaid wages would:

a) Debit Wage Expense and credit Accrued Wages Payable.
b) Credit both Wage Expense and Cash.
c) Credit Wage Expense and debit Accrued Wages Payable.
d) Debit both Wage Expense and Accrued Wages Payable.

problem: Telephone service costs the Eggleston Motor Hotel $250 per week. The business pays its phone service bill on the fifteenth day of each month, but it prepares its financial statements at the end of each month. Which of the following types of adjustments is required to ensure the accuracy of the Eggleston Motor Hotel's financial statements?

a) A liability/expense adjustment
b) An asset/expense adjustment
c) A liability/revenue adjustment
d) An asset/revenue adjustment

problem: Jaime failed to make adjusting entries to account for the use of prepaid insurance for his hotel. This mistake affects which of the following financial statements?

a) The balance sheet
b) The income statement   
c) a and b
d) The statement of cash flows

problem: If an accountant fails to make adjusting entries for utility service payments that have not yet been made:

a) Assets will be understated.
b) Gross revenue will be overstated.
c) Expenses will be understated.
d) Liabilities will be overstated.

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M9118

Have any Question? 

Related Questions in Financial Accounting

The following account balances were taken from abc companys

The following account balances were taken from ABC Company's 2020 balance sheets: January 1, 2020 December 31, 2020 Accounts payable ? 50,000 Accounts receivable ? 82,000 Cash 35,000 38,000 Common stock 105,000 135,000 I ...

Merger co has ten employees each of whom earns 2000 per

Merger Co. has ten employees, each of whom earns $2,000 per month and has been employed since January 1. FICA Social Security taxes are 6.2% of the first $106,800 paid to each employee, and FICA Medicare taxes are 1.45% ...

A lease can best be described as followsa a contract to

A lease can BEST be described as follows: a. A contract to rent, then purchase the asset at the conclusion of the lease term. b. An informal contract between the seller and the buyer of the property. c. A contractual agr ...

On january 1 2011 we started a new business by investing

On January 1, 2011 we started a new business by investing cash of $10,000 and equipment of $9,000. During the year we withdraw $2,000. When we prepare of Statement of Owners Equity we note a final balance of $21,000. Bas ...

An eleventh circuit client who files in the us court of

An eleventh circuit client who files in the US court of federal claims wants to know whether to include the terms of multiple options to renew a sale leaseback to calculate a deduction. What is authoritative reference? • ...

Green tee produces 100 percent cotton t-shirts with the

Green Tee produces 100 percent cotton t-shirts, with the following standard direct material and labor quantities and costs: Direct material 2.0 yards x $3.00 Direct labor   0.7 hour x $7.50 Actual September production an ...

Tundra corporation is interested in acquiring cantrell

Tundra Corporation is interested in acquiring Cantrell Corporation. Cantrell has 20 million shares outstanding and a target capital structure consisting of 30 percent debt and 70 percent equity. Cantrell's debt interest ...

In the current year jeanette an individual in the 25

In the current year, Jeanette, an individual in the 25% marginal tax bracket, recognized a $20,000 long term capital gain. Also in the current year, Parrot Corporation, a C corporation in the 25% marginal tax bracket, re ...

Collin corporationrsquos capital structure was as follows

Collin Corporation’s capital structure was as follows: December 31 Year 4 Year 5 Outstanding shares of stock: Common 200,000 200,000 Convertible preferred 10,000 10,000 Debt Outstanding: 9% convertible bonds(issued at pa ...

Abc corporation has provided the following information

ABC Corporation has provided the following information concerning a capital budgeting project: The working capital would be required immediately and would be released for use elsewhere at the end of the project. The comp ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate