Question : 71.A company recorded office supplies in an asset account when : 1244521

71.A company recorded office supplies in an asset account when the supplies were purchased. Failure to take inventory and make an adjusting entry will result in an

 

a.

overstatement of stockholders’ equity.

b.

understatement of liabilities.

c.

understatement of stockholders’ equity.

d.

understatement of assets.

 

 

 

72.A company’s five-day weekly payroll of $680 is paid on Fridays. Assume that the last day of the month falls on Wednesday. Which of the following is the required adjusting entry?

 

a.

Debit Salaries Expense $272 and credit Salaries Payable $272

b.

Debit Unpaid Salaries $408 and credit Salaries Payable $408

c.

Debit Salaries Expense $408 and credit Salaries Payable $408

d.

Debit Salaries Payable $408 and credit Salaries Expense $408

 

 

 

73.The adjustment for estimated income taxes would include a

 

a.

credit to Income Taxes Expense.

b.

credit to Income Taxes Payable.

c.

debit to Unearned Income Taxes.

d.

credit to Cash.

 

 

 

74.Accumulated depreciation is classified as a(n)

 

a.

contra-expense account.

b.

expense account.

c.

contra-asset account.

d.

liability account.

 

 

 

75.The adjustment for the expiration of prepaid advertising, originally recorded as an asset, consists of a debit to

 

a.

Advertising Expense and a credit to Prepaid Advertising.

b.

Prepaid Advertising and a credit to Cash.

c.

Prepaid Advertising and a credit to Advertising Expense.

d.

Advertising Expense and a credit to Cash.

 

 

 

76.Which of the following accounts could not be credited in an adjusting entry?

 

a.

Prepaid Rent

b.

Earned Revenue

c.

Interest Receivable

d.

Office Supplies

 

 

 

77.Which of the following pairs of accounts could not be included in the same adjusting entry?

 

a.

Wages Expense and Wages Payable

b.

Interest Expense and Interest Receivable

c.

Rent Expense and Rent Payable

d.

Unearned Revenue and Revenue from Services

 

 

 

78.In November, cash is received in advance of rendering services. Assuming that the services have been performed by December 31, the adjusting entry would be a debit to

 

a.

Cash and a credit to Service Revenue.

b.

Service Revenue and a credit to Prepaid Services.

c.

Unearned Service Revenue and a credit to Service Revenue.

d.

Unearned Service Revenue and a credit to Cash.

 

 

 

79.On December 9, A issues a 60-day promissory note to B. The December 31 adjusting entry for A is a debit to

 

a.

Interest Expense and a credit to Cash.

b.

Interest Receivable and a credit to Interest Income.

c.

Interest Expense and a credit to Interest Payable.

d.

Interest Payable and a credit to Cash.

 

 

 

80.The entry to record depreciation on a building is a debit to

 

a.

Depreciation Expense–Building and a credit to Cash.

b.

Depreciation Expense–Building and a credit to Building.

c.

Accumulated Depreciation–Building and a credit to Building.

d.

Depreciation Expense–Building and a credit to Accumulated Depreciation–Building.