Question 8 These are cash received in advance but not yet earned. Unearned revenues B Prepayments CPrepaid Expenses Deferred Expenses Question 9 This method of recording cash received in advance but not yet earned recognizes a liability in its adjusting entry. Expense method (B) Asset Method (C) Income method Liability method Question 10 It is the difference between the Acquisition Cost and Salvage Value of a depreciable asset. A Depreciable Cost (B) Depreciation Expense Accumulated Depreciation (D) Carrying Value Question 11 It is the systematic and rational allocation of the depreciable cost of an asset over its estimated useful life. A) Depreciation (B) Allowance for Bad Debts Adjusting Entry Salvage Value Question 12 1 Point 1 Point 1 Point 1 Point 1 Point Decide whether the error may or may not be revealed by drafting a trial balance: An equipment purchase for P 700,000 cash was recorded as debit to Supplies Expense and credit to Cash Can be revealed (B May not be revealed Neither; unaccountable transaction Question 13 Statement I: Equality of the debits and credits in the trial balance ensures that posting has been performed correctly. Statement II: The sequence of the account titles in the trial balance depends upon the size of the account balances. (A) Both Statements are TRUE B Both Statements are FALSE Only Statement I is TRUE (D) Only Statement II is TRUE 1 Point