FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 2: Review of the Accounting Process

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 61

True/False

Review LaterAdd Note

Review Later

Balance sheet accounts are referred to as temporary accounts because their balances are always changing.

A) True
B) False

Correct Answer

verified

Show Answer

Question 62

Essay

Review LaterAdd Note

Review Later

Describe what is meant by prepaid expenses and provide two examples.

Correct Answer

verified

Prepaid expenses represent ass...

View Answer

Show Answer

Question 63

Essay

Review LaterAdd Note

-Prepaid rent

On November 1,2016,Tim's Toys borrows $30,000,000 at 9% to finance the holiday sales season.The note is for a six-month term and both principal and interest are payable at maturity.What is the balance of interest payable for the loan as of December 31,2016?

The adjusting entry required when amounts previously recorded as deferred revenues are recognized includes:

When Castle Corporation pays insurance premiums,the transaction is recorded as a debit to prepaid insurance.Additional information for the year ended December 31 is as follows: What was the total amount of cash paid by Castle for insurance premiums during the year?

-Property taxes payable

The accounting system of Carlton and Sons consists of a general journal (GJ),a cash receipts journal (CR),a cash disbursements journal (CD),a sales journal (SJ),and a purchases journal (PJ).For each of the following,indicate which journal should be used to record the transaction.

After an unadjusted trial balance is prepared,the next step in the accounting processing cycle is the preparation of financial statements.

Mama's Pizza Shoppe borrowed $8,000 at 9% interest on May 1,2016,with principal and interest due on October 31,2017.The company's fiscal year ends June 30,2016.What adjusting entry is necessary on June 30,2016?

-Supplies expense

The accounting equation can be stated as:

Use the following to answer questions The following information,based on the 12/31/16 Annual Report to Shareholders of Krafty Foods ($ in millions): -Based on the information presented above,prepare the 2016 Income Statement for Krafty Foods.

Cost of goods sold is:

Prepayments occur when:

Use the following to answer questions Using the chart of accounts provided,indicate by account number the account or accounts that would be debited and credited in the following transactions and indicate the type of transaction as: (1)an external transaction, (2)an internal transaction recorded as an adjusting journal entry,or (3)a closing entry.The company uses a perpetual inventory system.All prepayments are initially recorded in permanent accounts. -Purchased building and equipment for $10,000,000,paying 20% cash and issuing a 30-year note for the balance.

On December 31,2015,Coolwear,Inc.had a balance in its prepaid insurance account of $48,400.During 2016,$86,000 was paid for insurance.At the end of 2016,after adjusting entries were recorded,the balance in the prepaid insurance account was 42,000.Insurance expense for 2016 would be:

Use the following to answer questions Using the chart of accounts provided,indicate by account number the account or accounts that would be debited and credited in the following transactions and indicate the type of transaction as: (1)an external transaction, (2)an internal transaction recorded as an adjusting journal entry,or (3)a closing entry.The company uses a perpetual inventory system.All prepayments are initially recorded in permanent accounts. -Sold inventory for cash.

Use the following to answer questions Using the chart of accounts provided,indicate by account number the account or accounts that would be debited and credited in the following transactions and indicate the type of transaction as: (1)an external transaction, (2)an internal transaction recorded as an adjusting journal entry,or (3)a closing entry.The company uses a perpetual inventory system.All prepayments are initially recorded in permanent accounts. -Invested idle cash in short-term money market funds.

Describe what is meant by deferred revenues and provide two examples.