1.When a deferral adjustment is made to a liability account, that liability becomes a(n):

Multiple Choice

• asset.

• other liability.

• expense.

• revenue

2.A company owes rent at a rate of $6,000 per month. The company pays the rent owed on the tenth of each month for the previous month. At the end of each month, what kind of adjustment is required?

Multiple Choice

• An accrual adjustment.

• A closing adjustment.

• A deferral adjustment.

• No adjustment.

3.Adjustments ensure that ____ balances are reported at amounts representing the economic benefits used during the period.

Multiple Choice

• expense

• revenue

• asset

• account

4.The deferral adjustment to record the amount of Deferred service revenue that is now earned includes a:

Multiple Choice

• debit to Deferred Revenue.

• credit to Deferred Revenue.

• debit to Service Revenue.

• credit to Accounts Receivable.