Wiley Exam 2 Practice M/C And T/F
Questions And Answers With Verified
Solutions 100% Correct !!!
T/F: The revenue recognition principle dictates that revenue is recognized in the
period in which the cash is received. - ANSWER✔✔False, should be recognized in
the accounting period in which the performance obligation is satisfied
T/F: The expense recognition principle requires that expenses be recognized in the
same period that they are paid. - ANSWER✔✔True
T/F: Book value is equal to cost minus accumulated depreciation. -
ANSWER✔✔True
T/F: Prior to an accrual adjustment, the revenue account (and the related asset
account) or the expense account (and the related liability account) is understated. -
ANSWER✔✔True
T/F: The expense recognition principle is frequently referred to as the matching
principle. - ANSWER✔✔True
T/F: Accumulated depreciation is liability account - ANSWER✔✔False
T/F:A liability—revenue account relationship exists with an unearned rent revenue
adjustment. - ANSWER✔✔True
T/F: Unearned revenue is a prepayment that requires an adjustment when services
are performed. - ANSWER✔✔True
, T/F: The adjustment for unearned revenue results in an increase to an asset account
and an increase to a revenue account.
Select answer from the options below - ANSWER✔✔False
T/F
Asset prepayments become expenses when they expire - ANSWER✔✔True
T/F
A Contra asset account is subtracted from a related account in the balance sheet -
ANSWER✔✔True
T/F: Accrued revenues are revenues that have been recognized but cash has not
been received before financial statements have been prepared. - ANSWER✔✔True
T/F: The adjustment for accrued salaries requires a decrease to Salaries and Wages
Payable. - ANSWER✔✔False
T/F: Without an adjustment for accrued interest expense, liabilities and interest
expense are understated, and net income and stockholders' equity are overstated. -
ANSWER✔✔True
T/F: Financial statements can be prepared from the information provided by an
adjusted tabular summary of transactions. - ANSWER✔✔True
Expenses are recognized when:
Questions And Answers With Verified
Solutions 100% Correct !!!
T/F: The revenue recognition principle dictates that revenue is recognized in the
period in which the cash is received. - ANSWER✔✔False, should be recognized in
the accounting period in which the performance obligation is satisfied
T/F: The expense recognition principle requires that expenses be recognized in the
same period that they are paid. - ANSWER✔✔True
T/F: Book value is equal to cost minus accumulated depreciation. -
ANSWER✔✔True
T/F: Prior to an accrual adjustment, the revenue account (and the related asset
account) or the expense account (and the related liability account) is understated. -
ANSWER✔✔True
T/F: The expense recognition principle is frequently referred to as the matching
principle. - ANSWER✔✔True
T/F: Accumulated depreciation is liability account - ANSWER✔✔False
T/F:A liability—revenue account relationship exists with an unearned rent revenue
adjustment. - ANSWER✔✔True
T/F: Unearned revenue is a prepayment that requires an adjustment when services
are performed. - ANSWER✔✔True
, T/F: The adjustment for unearned revenue results in an increase to an asset account
and an increase to a revenue account.
Select answer from the options below - ANSWER✔✔False
T/F
Asset prepayments become expenses when they expire - ANSWER✔✔True
T/F
A Contra asset account is subtracted from a related account in the balance sheet -
ANSWER✔✔True
T/F: Accrued revenues are revenues that have been recognized but cash has not
been received before financial statements have been prepared. - ANSWER✔✔True
T/F: The adjustment for accrued salaries requires a decrease to Salaries and Wages
Payable. - ANSWER✔✔False
T/F: Without an adjustment for accrued interest expense, liabilities and interest
expense are understated, and net income and stockholders' equity are overstated. -
ANSWER✔✔True
T/F: Financial statements can be prepared from the information provided by an
adjusted tabular summary of transactions. - ANSWER✔✔True
Expenses are recognized when:
