ACCT 2000 EXAM 2 LOWE-ARDOIN QUESTIONS
WITH CORRECT ANSWERS 2025/2026
Perodicity f - f correct f answer f -
requires f accountants f to f divide f the f economic f life fof f a f business f into fartificial f time f period
The f revenue f recognition fprinciple f - f correct f answer f -
companies f recognize f revenue f in f the f accounting f period f in f which fthe fperformance f obligation f is
fsatisfied
The f expense frecognition fprinciple f - f correct f answer f -
expenses f are f matched fwith f revenues f in f the f period fwhen f efforts f are fexpended fto fgenerate f revenue
Accrual f basis f accounting f - fcorrect f answer f-
revenues fthat fare frecognized fwhen fservices fare fpreformed, feven fif fcash fwas fnot freceived.
fExpenses far f e frecognized fwhen fincurred, feven fif fcash fwas fnot fpaid f( fdoesnt ffollow fcash f)
Cash f basis f accounting f - f correct f answer f -
revenues fare frecognized fonly fwhen fcash fis freceived fand fexpenses fare frecognized fonly fwhen
fcash fis fpa fid. fNot fgaap. f( ffollow fcash f)
Everytime fit fprepares ffinancial fstatements f- fcorrect
fanswer f- fwhen fdoes fa fcompany fmake fadjusting fentries?
Prepaid f expense f - f correct f answer f -
expenses f paid f in f cash f and f recorded f as f assets f before f they f are f used for f consumed
Unearned f revenue f - f correct f answer f -cash freceived fand f reported f as fliabilities f before frevenue f is
fearned
Increase f to f an f expense; f decrease f to f an f asset f - f correct f answer f -
adjusting f entry f results f in f a f increase f to f account f and f a f decrease f to f a f account
, Accruals; f accrued f revenue f - f correct f answer f-
revenue f for f services f performed f but f not f yet f received f in f cash f or f recorded
WITH CORRECT ANSWERS 2025/2026
Perodicity f - f correct f answer f -
requires f accountants f to f divide f the f economic f life fof f a f business f into fartificial f time f period
The f revenue f recognition fprinciple f - f correct f answer f -
companies f recognize f revenue f in f the f accounting f period f in f which fthe fperformance f obligation f is
fsatisfied
The f expense frecognition fprinciple f - f correct f answer f -
expenses f are f matched fwith f revenues f in f the f period fwhen f efforts f are fexpended fto fgenerate f revenue
Accrual f basis f accounting f - fcorrect f answer f-
revenues fthat fare frecognized fwhen fservices fare fpreformed, feven fif fcash fwas fnot freceived.
fExpenses far f e frecognized fwhen fincurred, feven fif fcash fwas fnot fpaid f( fdoesnt ffollow fcash f)
Cash f basis f accounting f - f correct f answer f -
revenues fare frecognized fonly fwhen fcash fis freceived fand fexpenses fare frecognized fonly fwhen
fcash fis fpa fid. fNot fgaap. f( ffollow fcash f)
Everytime fit fprepares ffinancial fstatements f- fcorrect
fanswer f- fwhen fdoes fa fcompany fmake fadjusting fentries?
Prepaid f expense f - f correct f answer f -
expenses f paid f in f cash f and f recorded f as f assets f before f they f are f used for f consumed
Unearned f revenue f - f correct f answer f -cash freceived fand f reported f as fliabilities f before frevenue f is
fearned
Increase f to f an f expense; f decrease f to f an f asset f - f correct f answer f -
adjusting f entry f results f in f a f increase f to f account f and f a f decrease f to f a f account
, Accruals; f accrued f revenue f - f correct f answer f-
revenue f for f services f performed f but f not f yet f received f in f cash f or f recorded
