1. Deferral type adjustments occur when cash for expenses is paid in advance or cash from incomes is pre-collected. How many of the following will require a deferral type adjustment? Rent paid for in advance Buildings to be depreciated Rent collected in advance from tenants Stationery used by the office staff during the period Select one: a. 1 b. 2 C. 3 d. 4 are obligations of the firm that are expected, in the normal course of business, to be settled in the next twelve months. Note - there are TWO words in this answer 2. The basis of accounting is not a generally accepted method of determining profit for businesses that have significant credit transactions. 3. 4. Which of the following is not an advantage of preparing an adjusted trial balance? Select one: a. a. It verifies that the debits equal the credits in the ledger after the preparation of the adjusting entries b. It reduces the possibility of errors being carried forward from the ledger into the accounting reports c. It is a shortcut which means that the adjusting entries do not have to be entered into the ledger d. It assists in the preparation of the financial statements Under the basis of accounting, income is recognised when earned and expenses when incurred. 5