Acct 2000 Exam 2 LSU terms Questions and Correct Answers | Latest Update

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Acct 2000 Exam 2 LSU terms Questions and Correct
Answers | Latest Update
1. With _______Accounting, transactions are recorded in the period in
which the event occurs, not when the cash is received.

Ans: Accrual

1. The ______ Recognition Principle requires companies to recognize
revenue in the accounting period in which it is earned.

Ans: Revenue
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1. Adjustments are prepared every time ______________ are issued in order
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to ensure all accounts are correctly reported.

Ans: Financial Statements

Adjustments includes one ______ and one ____ accounts.
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Ans: Balance Sheet (assets or liability)
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Income Statement (revenue or expense)

1. Accumulated Deprecation is what type of account? ________. What
financial statement would include this account? ______________

Ans: Contra Asset Account

Balance Sheet

List the four types of adjustments:

Ans: 1. Prepaid expenses

2. Unearned revenues

3. accrued revenues

4. accrued expenses

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An accrued expense adjustment, records amounts owed (or incurred), but
not yet paid. Prior to completing this type of adjustment, which accounts
are understated?

Ans: Expenses and Liabilities

A Supply account at the end of the period showed a balance of $5,000.
However, a physical counts showed only $3,000. To correct this issue,
the supplies account is _________________ and the supplies expense
account is ______ by ________________.

Ans: Decreased
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Increased
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$2,000

A Supply account at the end of the period showed a balance of $5,000.
However, a physical counts showed only $3,000. To correct this issue,
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the supplies account is decreased and the supplies expense account is
increased by $2,000.
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from the scenario above, if the company does not make the adjustment,
supplies expense, net income, and stockholders' equity would be
_____________and assets would be ____________.

Ans: understated

overstated

Which one of these statements about the accrual basis of accounting is
false?

a. Companies record events that change their financial statements in the
period in which events occur, even if cash was not exchanged.

b. Companies recognize revenue in the period in which it is earned.

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c. This basis is in accord with generally accepted accounting principles.

d. Companies record revenue only when they receive cash, and record
expense only when they pay out cash.

Ans: d. Companies record revenue only when they receive cash, and
record expense only when they pay out cash.

1) Each of the following is a major type (or category) of adjustment
except:

a. Prepaid expenses
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b. Accrued revenues
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c. Accrued expenses

d. Earned expenses

Ans: d. Earned expenses
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1) Colleen Mooney earned a salary of $600 for the last week of
September. She will be paid on October 1. The adjustment for Colleen's
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employer at September 30 is:

a. No entry is required.

b. Increase to Salaries and Wages Expense, $600 and Increase to Salaries
and Wages Payable, $600

c. Increase to Salaries and Wages Expense, $600 and Increase to Cash,
$600

d. Increase to Salaries and Wages Payable, $600 and Increase to Cash,
$600

Ans: b. Increase to Salaries and Wages Expense, $600 and Increase to
Salaries and Wages Payable, $600