ACCT 2000 LATEST EVALUATION EXAM
QUESTIONS AND ANSWERS SURE A+
✔✔____________ accounts are debited and ____________ accounts are credited in
the adjusting journal entries for unearned revenue. - ✔✔liability; revenue
✔✔What are the two types of accrual adjusting entries? - ✔✔accrued revenue and
accrued expenses
✔✔Adjusting entries are needed to ensure that the ____________ and ___________
principles are followed. - ✔✔expense; revenue
✔✔Expenses paid in cash and recorded as assets before they are used or consumed
are called ____________ ______________. - ✔✔Prepaid Expenses
✔✔Cash received and reported as liabilities before revenue is earned is called
_____________ ____________. - ✔✔Unearned Revenue
✔✔Revenues earned but not yet received in cash or recorded are called ___________
_____________. - ✔✔Accrued Revenue
, ✔✔Expenses incurred but not yet paid in cash or recorded are called ______________
______________. - ✔✔Accrued Expenses
✔✔If there are no adjusting entries for accrued revenue, ______________ and
____________ are understated. - ✔✔revenues; assets
✔✔If there are no adjusting entries for accrued expenses, ______________ and
____________ are understated. - ✔✔expenses; liabilities
✔✔____________ accounts are debited and ____________ accounts are credited in
the adjusting journal entries for accrued revenue. - ✔✔receivable; revenue
✔✔____________ accounts are debited and ____________ accounts are credited in
the adjusting journal entries for accrued expenses. - ✔✔expense; payable
✔✔When closing the books, we close the ________________ (RED) accounts. -
✔✔temporary
✔✔The balance of the Income Summary should equal _________ ___________. -
✔✔Net Income
✔✔What is the permanent account? - ✔✔retained earnings
✔✔What formula do we use to calculate interest? - ✔✔principle x rate x time
✔✔The ________ __________ is prepared from the ledger accounts after all adjusting
entries are journalized and posted. - ✔✔trial balance
✔✔The purpose of the adjusted trial balance is to prove the equality of _________ and
__________ balances in the ledger. - ✔✔debit; credit
✔✔The adjusted trial balance is the _____________ basis for the preparation of the
financial statements. - ✔✔primary
✔✔Which financial statements are preparted directly from the Adjusted Trial Balance? -
✔✔income statement, retained earnings statement and balance sheet
✔✔At the end of the accounting period, companies transfer the ______________
account balances to the _______________ stockholder's equity accounts -- Retained
Earnings. - ✔✔temporary; permanent
QUESTIONS AND ANSWERS SURE A+
✔✔____________ accounts are debited and ____________ accounts are credited in
the adjusting journal entries for unearned revenue. - ✔✔liability; revenue
✔✔What are the two types of accrual adjusting entries? - ✔✔accrued revenue and
accrued expenses
✔✔Adjusting entries are needed to ensure that the ____________ and ___________
principles are followed. - ✔✔expense; revenue
✔✔Expenses paid in cash and recorded as assets before they are used or consumed
are called ____________ ______________. - ✔✔Prepaid Expenses
✔✔Cash received and reported as liabilities before revenue is earned is called
_____________ ____________. - ✔✔Unearned Revenue
✔✔Revenues earned but not yet received in cash or recorded are called ___________
_____________. - ✔✔Accrued Revenue
, ✔✔Expenses incurred but not yet paid in cash or recorded are called ______________
______________. - ✔✔Accrued Expenses
✔✔If there are no adjusting entries for accrued revenue, ______________ and
____________ are understated. - ✔✔revenues; assets
✔✔If there are no adjusting entries for accrued expenses, ______________ and
____________ are understated. - ✔✔expenses; liabilities
✔✔____________ accounts are debited and ____________ accounts are credited in
the adjusting journal entries for accrued revenue. - ✔✔receivable; revenue
✔✔____________ accounts are debited and ____________ accounts are credited in
the adjusting journal entries for accrued expenses. - ✔✔expense; payable
✔✔When closing the books, we close the ________________ (RED) accounts. -
✔✔temporary
✔✔The balance of the Income Summary should equal _________ ___________. -
✔✔Net Income
✔✔What is the permanent account? - ✔✔retained earnings
✔✔What formula do we use to calculate interest? - ✔✔principle x rate x time
✔✔The ________ __________ is prepared from the ledger accounts after all adjusting
entries are journalized and posted. - ✔✔trial balance
✔✔The purpose of the adjusted trial balance is to prove the equality of _________ and
__________ balances in the ledger. - ✔✔debit; credit
✔✔The adjusted trial balance is the _____________ basis for the preparation of the
financial statements. - ✔✔primary
✔✔Which financial statements are preparted directly from the Adjusted Trial Balance? -
✔✔income statement, retained earnings statement and balance sheet
✔✔At the end of the accounting period, companies transfer the ______________
account balances to the _______________ stockholder's equity accounts -- Retained
Earnings. - ✔✔temporary; permanent
