QuickBooks Chapter 7 Questions and Answers 100% Verified

QuickBooks Chapter 7 Questions and
Answers 100% Verified
The purpose of an adjusting entry is:

A)Revenue was earned but not recorded.

B)Expenses incurred but not recorded.

C)To show the prepaid expense for one month.

D)Customer paid in advance of receiving goods or services.


E)All of the above. ✔✔E)All of the above




Adjusting entries are made on the:

A)15th of every month

.B)First day of the new year, meaning January 1.

C)Last day of the month, quarter, or year.

D)Adjusting entries are rarely recorded for a company.


E)All of the above. ✔✔C)Last day of the month, quarter, or year




On January 1 of the new year, this account shows Net Income:

A)Sales.

, B)Cost of Goods Sold.

C)Common Stock.

D)Retained Earnings


E)None of the above. ✔✔D)Retained Earnings




On January 1, the Profit & Loss statement shows the following account balances:

A)The same as on December 31 of the previous year.

B)Zero.

C)The same as the Balance Sheet accounts.

D)The same as the Statement of Cash Flows accounts.


E)None of the above. ✔✔B)Zero




The Exercise 6-2 December trial balance shows account balances before:

A)Recording expenses.

B)Adjustments.

C)Additional Common Stock investment.

D)Before bills are paid.


E)None of the above. ✔✔B)Adjustments