Roland Richard, a baker, purchased 200 ounces of of an expensive spice for $400 on 3/1/09.

The journal entry to record the purchase was

3/1/09 Spice Inventory 400

Cash 400

By December, 12/31/09, there were 80 ounces on hand. Which of the following is the correct adjusting journal entry for 12/31/09?

	A.	debit Spice Expense and credit Spice Inventory 160
	B.	debit Spice Inventory and credit Spice Expense 160
	C.	debit Spice Inventory and credit Spice Expense 240
	D.	debit Spice Expense and credit Spice Inventory 240

Which expense is most likely to be recognized under the rational and systematic allocation approach (as opposed to the matching and immediate recognition approaches)?

	A.	Bad debt expense
	B.	Cost of goods sold
	C.	Interest expense
	D.	Research and Development Expense

Which of the following accounts would have a zero balance after closing entries have been made?

	A.	Sales Revenue
	B.	Cash
	C.	Retained Earnings
	D.	Prepaid Accounting Expense