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ACCT 2000 LOWE-ARDOIN (ACTUAL 2025/2026)
EXAM 2 NEWEST QUESTIONS AND WITH VERIFIED
ANSWERS /GRADED A+
With ______________ ___________ Accounting, transactions are recorded in the
period in which the event occurs, not when the cash is received. -
(answers)Accrual Basis
The ____________ Recognition Principle reuqires companies to recognize
revenue in the accounting period in which it is earned. - (answers)revenue
Adjusting entries should be prepared every time _____________
________________ are issued in order to ensure all accounts are correctly
reported. - (answers)financial statements
From what document are financial statements prepared? - (answers)adjusted trial
balance
Which account is never affected by adjusting entries? - (answers)cash
Accumulated Depreciation is what type of account? - (answers)contra asset
What financial statement would include this account? - (answers)balance sheet
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An accrued expense adjusting entry records amounts owed (or incurred), but not
yet paid. Prior to completing this type of adjusting entry, which accounts are
understated? - (answers)expense and liability (payable)
Temporary accounts are closed at the end of each _________. - (answers)year
What are the three types of temporary accounts? - (answers)revenues, expenses,
and dividends
Which two accounts are closed directly into retained earnings? - (answers)income
summary and dividends
What is the first step in the accounting cycle? - (answers)analyze transactions
What is the last step in the accounting cycle? - (answers)prepare a post-closing
trial balance
Net Sales - Cost of Goods Sold = - (answers)Gross Profit
Which inventory method maintains continuous records of inventory every time a
purchase or sale is made? - (answers)perpetual
ACCT 2000 LOWE-ARDOIN (ACTUAL 2025/2026)
EXAM 2 NEWEST QUESTIONS AND WITH VERIFIED
ANSWERS /GRADED A+
With ______________ ___________ Accounting, transactions are recorded in the
period in which the event occurs, not when the cash is received. -
(answers)Accrual Basis
The ____________ Recognition Principle reuqires companies to recognize
revenue in the accounting period in which it is earned. - (answers)revenue
Adjusting entries should be prepared every time _____________
________________ are issued in order to ensure all accounts are correctly
reported. - (answers)financial statements
From what document are financial statements prepared? - (answers)adjusted trial
balance
Which account is never affected by adjusting entries? - (answers)cash
Accumulated Depreciation is what type of account? - (answers)contra asset
What financial statement would include this account? - (answers)balance sheet
, 2|Page
An accrued expense adjusting entry records amounts owed (or incurred), but not
yet paid. Prior to completing this type of adjusting entry, which accounts are
understated? - (answers)expense and liability (payable)
Temporary accounts are closed at the end of each _________. - (answers)year
What are the three types of temporary accounts? - (answers)revenues, expenses,
and dividends
Which two accounts are closed directly into retained earnings? - (answers)income
summary and dividends
What is the first step in the accounting cycle? - (answers)analyze transactions
What is the last step in the accounting cycle? - (answers)prepare a post-closing
trial balance
Net Sales - Cost of Goods Sold = - (answers)Gross Profit
Which inventory method maintains continuous records of inventory every time a
purchase or sale is made? - (answers)perpetual
