DeAnza College

ACCT 1A

CHAPTER 3

1)Adjusting entries affect at least one a.asset and one owner's equity account b.revenue and one owner's equity account

c.income statement account and one balance sheet account

d.revenue and the dividends account

2. Buster Industries pays weekly salaries of $26,300 on Friday for a five-day week ending on that day. The adjusting entry necessary at the end of the fiscal period ending on Tuesday is

a.debit Salary Expense, $10,520; credit Drawing, $10,520

b.debit Salary Expense, $10,520; credit Salaries Payable, $10,520

c.debit Salaries Payable, $10,520; credit Cash, $10,520 d.debit Drawing, $10,520; credit Cash, $10,520

3. The balance in the prepaid rent account before adjustment at the end of the year is

$17,591, which represents 10 months' rent paid on December 1. The adjusting entry required on December 31 is

a.debit Rent Expense, $1,759; credit Prepaid Rent, $1,759

b.debit Rent Expense, $15,832; credit Prepaid Rent, $1,759 c.debit Prepaid Rent, $15,832; credit Rent Expense, $1,759 d.debit Prepaid Rent, $1,759; credit Rent Expense, $1,759

4. Which of the following is considered to be unearned revenue? a.theater tickets sold last month for yesterday's performance b.theater tickets sold yesterday on credit for yesterday's performance c.theater tickets that were not sold for the current performance d.theater tickets sold for next month's performance

5. Which account would normally not require an adjusting entry?

a.Cash

b.Accumulated Depreciation c.Wages Expense d.Accounts Receivable

6. The matching principle

a.states that the revenues and related expenses should be reported in the same period

b.determines whether the normal balance of an account is a debit or credit c.addresses the relationship between the journal and the balance sheet

d.requires that the dollar amount of debits equal the dollar amount of credits on a trial balance

7. Using accrual accounting, revenue is recorded and reported only

a.when the services are rendered without regard to when cash is received

b.when cash is received at the time services are rendered c.if cash is received after the services are rendered

d.when cash is received without regard to when the services are rendered

8. The balance in the office supplies account on January 1 was $6,105, the supplies purchased during January were $3,787, and the supplies on hand on January 31 were

$2,070. The amount to be used for the appropriate adjusting entry is