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19 1U- 111 12 13 14 15 1 14) The accountant for Moreau Ltd. failed to make the adjusting entry to record depreciation the current year. The effect of this error is a. assets are overstated; shareholders' equity and net income are understated. assets and expenses are understated, and net income is understated. c. net income is overstated, and liabilities are understated. assets, net income, and shareholders' equity are all overstated. d. 15) Interest due on a loan payable at December 31 equals $125. What adjusting entry is required to accrue this expense? a. Dr. Interest Payable for $125, Cr. Interest Expense for $125 b. Dr. Interest Expense for $125, Cr. Cash for $125 c. Dr. Interest Receivable for $125. Cr. Interest Revenue for $125 d. Dr. Interest Expense for $125. Cr. Interest Payable for $125 16) If a real estate company fails to accrue commission revenue, liabilities are overstated, and owners' equity is understated. b. assets are understated, and net income is understated c. net income is understated, and shareholders' equity is overstated. revenues are understated, and net income is overstated. 17) Adjusting entries a. are recorded at the end of an accounting period. b are needed to measure the period's net income or net loss. C update the accounts. d. All of the above 18) On a trial balance, which of the following would indicate that an error has been made? a Service Revenue has a debit balance. b. Salary Expense has a debit balance. Accumulated Depreciation has a credit balance. d. All of the above indicate errors. 19) The entry to close Management Fees Revenue would be a. Management Fees Revenue does not need to be closed out. b. Dr. Retained Earnings Cr. Management Fees Revenue