B.Multiple Choice 1. Assumption of Time Period states: a. Companies must wait until the calendar year is over to compile financial statements b. Companies use the fiscal year to report financial information c. The economic life of the company is divided into artificial time periods d. The company records the transaction within the period in which it occurred 2. Flower Shop "Beautiful on July 30, earned $3,000 in sales. On August 5th the bill was sent to the customer, and on August 10th it was received checks from customers. According to the revenue recognition principle, on what date was the sale of $3,000 above, recognized? a. August 5th. b. August 10 3. Accumulated depreciation account c. July 30 d. August 1 a. is a contra-liability account. b. increases on the debit side. c. is offset against total assets on the statement of financial position. d. has a normal credit balance. 4. Speedy Clean, a laundry service company, on June 2 bought Supplies worth 6,500, and records Supplies as Assets. At the end of the month, June 30, it is known from the physical count, Supplies that are still on hand, worth 1,500. adjustments that must be made by the company on June 30, are: (Supplies: Physical assets that have been used up) Journal a. Debit Laundry Supplies Expense, 1,500; Credit Laundry Supplies, 1,500. b. Debit Laundry Supplies, 1,500; Credit Laundry Supplies Expense, 1,500. c. Debit Laundry Supplies, 5,000; Credit Laundry Supplies Expense, 5,000. d. Debit Laundry Supplies Expense, 5,000; Credit Laundry Supplies, 5,000. E Adjusted trial balance is made...... after the preparation of the Financial Statements b. before Trial Balance. c. to prove the similarity of total assets and total liabilities d. after the adjustment journal and posting it