Question 20

1. 12.On April 1, 2017 Green Company received an advance payment of $60,000 from a customer.The payment was for five months of services Green would perform for the customer at the rate of $12,000 per month.Green started providing the service on April 1, 2017.On April 1, 2017 Green made an entry in its accounting system debiting Cash for $60,000 and crediting Unearned Service Revenue for $60,000.This is the only entry that has been made related to this transaction.Select the adjusting entry Green should make prior to preparing financial statements on April 30, 2017.

A. Unearned Service Revenue 48,000

1. Service Revenue 48,000

B. Service Revenue 48,000

1. Unearned Service Revenue 48,000

C. Service Revenue 12,000

1. Unearned Service Revenue 12,000

D. Unearned Service Revenue 12,000

1. Service Revenue 12,000

E.None of the above

Question 21

13.Using the information given in 12. above - select the adjusting entry Green should make prior to preparing financial statements on May 31, 2017.Prior to this May 31, 2017 adjusting entry, Green has made only two entries in their accounting system related to this advance payment - the April 1, 2017 entry to record the receipt of the $60,000 cash and the April 30, 2017 adjusting entry.

A. Unearned Service Revenue 36,000

Service Revenue 36,000

B. Service Revenue 36,000

Unearned Service Revenue 36,000

C. Service Revenue 12,000

Unearned Service Revenue 12,000

D. Unearned Service Revenue 12,000

Service Revenue 12,000

E.None of the above

Question 22

14.Using the information given in 12. above, and assuming that all the required adjusting entries have been correctly made - what should be the amount shown on Green's June 30, 2017 Balance Sheet for Unearned Service Revenue?

A.$60,000

B.$48,000

C.$36,000

D.$0

E.None of the above

Question 23

1. 15.Which of the following would not be shown on the Balance Sheet?

A.Buildings

B.Depreciation Expense

C.Land

D.Office Equipment

E.All would be shown on the Balance Sheet

Question 24

16.A transaction entered in the general journal must consist of

A.only a single debit amountanda single credit amount.

B.only two debitsortwo credits of equal dollar amount.

C.only debit entries if liabilitiesandowners' equity arenotaffected.

D.only credit entries if assetsandexpenses arenotaffected.

E.none of the above

Question 25

17.Which of the following statement(s) is/are true?

A.Cost of Goods Sold is an Asset.

B.Cost of Goods Sold is an Expense.

C.Cost of Goods Sold starts each accounting period with a zero balance.

D.Cost of Goods Sold increases Owners' Equity.

E.Two of the above are true.

Question 26

1. 18.A Trial Balance:

A.Shows all of the account balances from the General Journal.

B.Shows only the account balances which will appear on the Balance Sheet.

C.Shows that all the account balances in a company's accounting system are correct.

D.Shows if the total dollar amount of the Debits equals the total dollar amount of the Credits for all of the account balances in the General Ledger.

E.None of the above

Question 27

19.After completing all 9 steps in the accounting cycle for the month of May, ABC Company's May 31 Ending Balance in the Retained Earnings account was $50,000 credit.ABC's Net Income for June was $20,000.ABC declared and paid a $5,000 dividend in June.The June beginning balance in ABC's Cash Account was $35,000 and the June ending balance in the Cash Account was $25,000.The Retained Earnings amount shown on ABC's June 30th Balance Sheet should be:

A.$70,000

B.$75,000

C.$65,000

D.$55,000

E.None of the above

Question 28

20.Which of the following statements about adjusting entries is true?

A.Adjusting entries are only made to Income Statement accounts.

B.An adjusting entry will always change the balance in the Cash account.

C.An adjusting entry always changes the balance in an expense account.

D.If an adjusting entry changes the balance in an asset account it will always change the balance in a revenue account.

E.None of the above

Question 29

21.The best place to look in a company's accounting system, if you wanted to see all of the accounts affected by a transaction, would be?

A..The General Journal

B.. The General Ledger

C.A Trial Balance

D.The Chart of Accounts

E.None of the above

Question 30

22.If a journal entry that affects only two accounts increases an asset as one part of the entry, what might the other part of the entry do?

A.Increase another asset account

B.Increase an expense account

C..Increase a liability account

D.Decrease a revenue account

E.None of the above

Question 31

23.Which of the following is True?

A.The Balance Sheet covers a period of time - the Income Statement reports on a point in time

B.The Income Statement covers a period of time - the Balance Sheet reports on a point in time

C.The Income Statement and the Balance Sheet cover a period of time

D.The Income Statement and the Balance Sheet report on a point in time

E.None of the above

Question 32

24.Which of the following statements is True?

A.The normal balance for the Cost of Goods Sold account is a Credit.

B.The Retained Earnings account will always start the accounting period with a zero balance.

C.When you Debit an expense account you can say that you increased the expense account and decreased owners' equity.

D.The normal balance for the Retained Earnings account is a Debit.

E.Retained Earnings is the amount of Cash available to pay a dividend.

Question 33

25.If an adjusting entry to record interest, which is owed to a bank on a Note Payable, is not recorded at month-end, which of the following effects on the financial statements for the month will NOT occur?

A.Total expenses will be understated on the income statement.

B.Net income will be overstated.

C.Liabilities on the balance sheet will be understated.

D.Cash will be overstated.

E.Retained Earnings will be overstated.

Question 34

26.The Retained Earnings account of a company had a Credit balance before closing the Revenue and Expense accounts.After closing the Revenue and Expense accounts the Retained Earnings account had a Debit balance.The company did not declare or pay any dividends during this accounting period.Based on this information it can be determined that the company incurred a loss for the period.

A.True

B.False

C.Not adequate facts to determine True or False