ACCT 2010 - Exam 2 with Complete
Solutions
Adjustments - ANS-Entries necessary at the end of each accounting period to report
revenues and expenses in the proper period and assets and liabilities at the appropriate
amounts. Also called Adjusting Journal Entries
Revenues - ANS-increases in assets or settlements of liabilities arising from providing
goods or services
Expenses - ANS-Decreases in assets or increases in liabilities arising from providing
goods or services during the current period
Assets - ANS-Probable future economic benefits owned by the business as a result of
past transactions
Liabilities - ANS-Probable debts or
Adjusting Journal Entries - ANS-Entries necessary at the end of each accounting period
to report revenues and expenses in the proper period and assets and liabilities at
appropriate amounts. also called Adjustments.
Expense Recognition Principle - ANS-Expenses are recorded when incurred in earning
revenue; also called "matching."
Carrying Value - ANS-The amounts at which an asset or liability is reported after
deducting any contra-accounts. Also called Book Value, Net Book Value.
Depreciation - ANS-Process of allocating the cost of buildings, equipment, and other
similar long-lived "productive" assets over their productive lives using a systematic and
rational method of allocation.
Contra-Account - ANS-An account that is an offset to, or reduction of, another account.
Revenue Recognition Principle - ANS-Revenues are recorded when (or as) the seller
provides goods or services to customers, in the amount the seller expects to be entitled
to receive.
Adjusted Trail Balance - ANS-A list of all accounts and their adjusted balances to check
on the equality of recorded debits and credits.
Solutions
Adjustments - ANS-Entries necessary at the end of each accounting period to report
revenues and expenses in the proper period and assets and liabilities at the appropriate
amounts. Also called Adjusting Journal Entries
Revenues - ANS-increases in assets or settlements of liabilities arising from providing
goods or services
Expenses - ANS-Decreases in assets or increases in liabilities arising from providing
goods or services during the current period
Assets - ANS-Probable future economic benefits owned by the business as a result of
past transactions
Liabilities - ANS-Probable debts or
Adjusting Journal Entries - ANS-Entries necessary at the end of each accounting period
to report revenues and expenses in the proper period and assets and liabilities at
appropriate amounts. also called Adjustments.
Expense Recognition Principle - ANS-Expenses are recorded when incurred in earning
revenue; also called "matching."
Carrying Value - ANS-The amounts at which an asset or liability is reported after
deducting any contra-accounts. Also called Book Value, Net Book Value.
Depreciation - ANS-Process of allocating the cost of buildings, equipment, and other
similar long-lived "productive" assets over their productive lives using a systematic and
rational method of allocation.
Contra-Account - ANS-An account that is an offset to, or reduction of, another account.
Revenue Recognition Principle - ANS-Revenues are recorded when (or as) the seller
provides goods or services to customers, in the amount the seller expects to be entitled
to receive.
Adjusted Trail Balance - ANS-A list of all accounts and their adjusted balances to check
on the equality of recorded debits and credits.
