Question 1

Cosmos Computer Consulting is preparing their year-end financial statements.They completed two projects in the last month: one worth $12,000 that they have billed the customer for but not yet been paid, and one worth $18,000 that they have not yet had a chance to bill the customer for.In the case of the second contract they had received a $3,000 deposit at the beginning of the contract.With respect to these two contracts what amount would be recorded as Revenue for Cosmos at year-end?

Accepted Answer

A)  $12,000
B)  $15,000
C)  $27,000
D)  $30,000

Question 2

Which of the following is a temporary account?

Accepted Answer

A)  Accounts receivable
B)  Accumulated depreciation
C)  Interest expense
D)  Wages payable

Question 3

On May 15th Bain Bathtubs signed a lease to rent a storefront starting on June 1st for the next two years at $1,000 per month.They paid the first two months' rent in advance on signing the lease.On May 15th how would the transaction be recorded?

Accepted Answer

A)  Dr.Rent expense $2,000, Cr.Cash $2,000
B)  Dr.Rent expense $24,000, Cr.Cash $24,000
C)  Dr.Prepaid rent $2,000, Cr.Cash $2,000
D)  Dr.Prepaid rent $24,000, Cr Cash $2,000 Cr.Rent payable $22,000

Question 4

From the following data what is the cost of sales? Beginning inventory $12,000, purchases $128,000, ending inventory $14,000.

Accepted Answer

A)  $116,000
B)  $126,000
C)  $128,000
D)  $130,000

Question 5

Cosmos Computer Consulting (CCC)  is preparing its year-end financial statements.They completed two projects in the last month: one worth $12,000 that has been invoiced to the customer but has not yet been paid, and one worth $18,000 that has not yet been invoiced to the customer.In the case of the second contract CCC received a $3,000 deposit at the beginning of the contract.With respect to these two contracts what amount would be recorded as accounts receivable for Cosmos at year-end?

Accepted Answer

A)  $12,000
B)  $18,000
C)  $27,000
D)  $30,000 C

Question 6

Pear Inc declared and paid a $10,000 dividend at the end of the year.How would the transaction be recorded?

Accepted Answer

A)  An increase in expense of $10,000 and a decrease in cash of $10,000.
B)  An increase in expense of $10,000 and a decrease in retained earnings of $10,000.
C)  A decrease in retained earnings of $10,000 and a decrease in expenses of $10,000.
D)  A decrease in retained earnings of $10,000 and a decrease in cash of $10,000.

Question 7

Which of the following is an example of a deferred expense adjusting entry?

Accepted Answer

A)  Dr.Rent expense, Cr.Prepaid rent
B)  Dr.Wages expense, Cr.Wage payable
C)  Dr.Unearned revenue, Cr.Revenue
D)  Dr.Accounts receivable, Cr.Sales

Question 8

Which of the following correctly describes the order of the accounting cycle?

Accepted Answer

A)  Post to the general ledger, post the adjusting entries, prepare trial balance, prepare financial statements and post closing journal entries.
B)  Post to the general ledger, post the adjusting entries, prepare trial balance, post closing entries and prepare financial statements.
C)  Post to the general ledger, post the adjusting entries, prepare financial statements, post closing journal entries and prepare trial balance.
D)  Post to the general ledger, post the adjusting entries, post closing journal entries, prepare the trial balance and prepare financial statements.

Question 9

Recording a transaction in two places in the accounts is an example of which principle?

Accepted Answer

A)  Accrual accounting
B)  Closing the books
C)  Adjusting the trial balance
D)  Double-entry bookkeeping

Question 10

Geneva Inc, had opened for business on September 1st but did not pay rent until September 15th, when they paid $6,000 in rent for the three months of September, October and November.How would the event be recorded on the September 30?

Accepted Answer

A)  Dr.Rent expense $500, Dr.Prepaid rent $5,500, Cr.Cash $6,000
B)  Dr.Rent expense $2,000 Dr.Prepaid rent $4,000 Cr.Cash $6,000
C)  Dr.Rent expense $6,000, Cr.Cash $6,000
D)  Dr.Prepaid rent $6,000, Cr.Cash $6,000 B

Question 11

On which of the following businesses' balance sheets would you most likely expect to see an unearned revenue account?

Accepted Answer

A)  Coffee shop
B)  Women's clothing store
C)  Manufacturer
D)  Airline

Question 12

Which of the following account balances increases with credits?

Accepted Answer

A)  Salary expense
B)  Prepaid rent
C)  Cash sales
D)  Dividends

Question 13

Which of the following would be used to record the sale of goods on credit for the period?

Accepted Answer

A)  A journal entry
B)  An adjusting entry
C)  A closing entry
D)  A temporary account

Question 14

A company purchased and received $2,500 worth of goods on credit to be sold in their stores.How would the event be recorded?

Accepted Answer

A)  Dr.Inventory $2,500, Cr.Expenses $2,500
B)  Dr.Expenses $2,500, Cr.Accounts payable $2,500
C)  Dr.Inventory $2,500, Cr.Accounts payable $2,500
D)  The event would not be recorded at this time.

Question 15

Which of the following is an advantage of accrual accounting?

Accepted Answer

A)  It does not require any judgment.
B)  It provides more relevant information.
C)  It does not provide more reliable information.
D)  It records all economic events.

Question 16

Which action describes "posting"?

Accepted Answer

A)  Recording the journal entry information in the general journal.
B)  Recording the adjusting and closing journal entries on the trial balance.
C)  Transferring the information in the journal entry from the general journal to the trial balance
D)  Transferring the information in the journal entry from the general journal to the general ledger.

Question 17

A company made the following entry in their books: Dr.Cash $25,000, Cr.Accounts receivable $25,000.What is the event that most likely occurred?

Accepted Answer

A)  The company collected monies owing from a customer.
B)  The company made a sale on credit.
C)  The company paid a bill that was due.
D)  The company borrowed money.

Question 18

Which accounting record is a listing of all the accounts and their balances?

Accepted Answer

A)  General journal
B)  T -account
C)  Trial balance
D)  Balance sheet C

Question 19

At the end of the accounting period, closing entries are used to reset the balance of the temporary accounts to zero.Into what account are the balances of the temporary accounts transferred?

Accepted Answer

A)  Unearned revenue
B)  Retained earnings
C)  Capital stock account
D)  Net income account

Question 20

Identify three different points in time that revenue could be recognized relative to when the payment is received.Give an example of each.

Accepted Answer

The three points in time are: 1) Before ...

Exam 3: The Accounting Cycle

Correct Answer
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Which of the following is a temporary account?

Correct Answer
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On May 15th Bain Bathtubs signed a lease to rent a storefront starting on June 1st for the next two years at $1,000 per month.They paid the first two months' rent in advance on signing the lease.On May 15th how would the transaction be recorded?

Correct Answer
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From the following data what is the cost of sales? Beginning inventory $12,000, purchases $128,000, ending inventory $14,000.

Correct Answer
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Correct Answer
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C

Pear Inc declared and paid a $10,000 dividend at the end of the year.How would the transaction be recorded?

Correct Answer
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Which of the following is an example of a deferred expense adjusting entry?

Correct Answer
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Which of the following correctly describes the order of the accounting cycle?

Correct Answer
verified

Recording a transaction in two places in the accounts is an example of which principle?

Correct Answer
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Geneva Inc, had opened for business on September 1st but did not pay rent until September 15th, when they paid $6,000 in rent for the three months of September, October and November.How would the event be recorded on the September 30?

Correct Answer
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B

On which of the following businesses' balance sheets would you most likely expect to see an unearned revenue account?

Correct Answer
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Which of the following account balances increases with credits?

Correct Answer
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Which of the following would be used to record the sale of goods on credit for the period?

Correct Answer
verified

A company purchased and received $2,500 worth of goods on credit to be sold in their stores.How would the event be recorded?

Correct Answer
verified

Which of the following is an advantage of accrual accounting?

Correct Answer
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Which action describes "posting"?

Correct Answer
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A company made the following entry in their books: Dr.Cash $25,000, Cr.Accounts receivable $25,000.What is the event that most likely occurred?

Correct Answer
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Which accounting record is a listing of all the accounts and their balances?

Correct Answer
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C

At the end of the accounting period, closing entries are used to reset the balance of the temporary accounts to zero.Into what account are the balances of the temporary accounts transferred?

Correct Answer
verified

Identify three different points in time that revenue could be recognized relative to when the payment is received.Give an example of each.

Correct Answer
verified
The three points in time are: 1) Before ...
View Answer

Exam 3: The Accounting Cycle

Correct AnswerverifiedShow Answer

Which of the following is a temporary account?

Correct AnswerverifiedShow Answer

On May 15th Bain Bathtubs signed a lease to rent a storefront starting on June 1st for the next two years at $1,000 per month.They paid the first two months' rent in advance on signing the lease.On May 15th how would the transaction be recorded?

Correct AnswerverifiedShow Answer

From the following data what is the cost of sales? Beginning inventory $12,000, purchases $128,000, ending inventory $14,000.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedC

Pear Inc declared and paid a $10,000 dividend at the end of the year.How would the transaction be recorded?

Correct AnswerverifiedShow Answer

Which of the following is an example of a deferred expense adjusting entry?

Correct AnswerverifiedShow Answer

Which of the following correctly describes the order of the accounting cycle?

Correct AnswerverifiedShow Answer

Recording a transaction in two places in the accounts is an example of which principle?

Correct AnswerverifiedShow Answer

Geneva Inc, had opened for business on September 1st but did not pay rent until September 15th, when they paid $6,000 in rent for the three months of September, October and November.How would the event be recorded on the September 30?

Correct AnswerverifiedB

On which of the following businesses' balance sheets would you most likely expect to see an unearned revenue account?

Correct AnswerverifiedShow Answer

Which of the following account balances increases with credits?

Correct AnswerverifiedShow Answer

Which of the following would be used to record the sale of goods on credit for the period?

Correct AnswerverifiedShow Answer

A company purchased and received $2,500 worth of goods on credit to be sold in their stores.How would the event be recorded?

Correct AnswerverifiedShow Answer

Which of the following is an advantage of accrual accounting?

Correct AnswerverifiedShow Answer

Which action describes "posting"?

Correct AnswerverifiedShow Answer

A company made the following entry in their books: Dr.Cash $25,000, Cr.Accounts receivable $25,000.What is the event that most likely occurred?

Correct AnswerverifiedShow Answer

Which accounting record is a listing of all the accounts and their balances?

Correct AnswerverifiedC

At the end of the accounting period, closing entries are used to reset the balance of the temporary accounts to zero.Into what account are the balances of the temporary accounts transferred?

Correct AnswerverifiedShow Answer

Identify three different points in time that revenue could be recognized relative to when the payment is received.Give an example of each.

Correct AnswerverifiedThe three points in time are: 1) Before ...View AnswerShow Answer

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C

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B

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C

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The three points in time are: 1) Before ...
View Answer