1. a company fails to make an adjusting entry to record supplies If expense. then: A) expense will be understated. equity be B) income will be understated. C) net D) assets will be understated. 2. The balance in prepaid rent account before adjustment at the end of the year is s15,000 and presents the rent paid on December 1. The adjusting entry required on three months December 31 is: Prepaid Rent, $15,000. A) debit Rent Expense, $15,000: credit C) debit Rent Expense, S5.000: credit Prepaid Rent, $5.000. D) debit Prepaid Rent, S10.000: credit Rent Expense, S10,000. 3. Supplies are recorded as assets when purchased. Therefore, the credit to supplies in the adjusting entry is for the amount of supplies: A) used. B) either used or remaining. C) remaining. D) purchased. 4. On July 7, 2014, Shireman Enterprises received cash $1.400 for services rendered. The entry to record this transaction will include A) a credit to Accounts Payable of $1,400. B) a debit to Service Revenue of S1,400. C) a debit to Cash of S1,400. D) a credit to Accounts Receivable of $1,400. Scrambled version A Page