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  • Review Question Bis First Year Accounting: 1-Accrued Expenses Are

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    Accrued expenses are incurred but not yet paid or recorded. An accumulated depreciation account is a contra-asset account that increases on the debit side and is offset against total assets on the balance sheet. Unearned revenue is classified as a contra-revenue account. For the adjusting entry on September 30, Carter Guitar would debit interest expense for $90 and credit interest payable for $90. Prepaid expenses are expenses paid in advance. Expenses not yet paid or recorded are called accrued expenses.

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    Accrued expenses are incurred but not yet paid or recorded. An accumulated depreciation account is a contra-asset account that increases on the debit side and is offset against total assets on the balance sheet. Unearned revenue is classified as a contra-revenue account. For the adjusting entry on September 30, Carter Guitar would debit interest expense for $90 and credit interest payable for $90. Prepaid expenses are expenses paid in advance. Expenses not yet paid or recorded are called accrued expenses.

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    10 views2 pages

    Review Question Bis First Year Accounting: 1-Accrued Expenses Are

    Uploaded by

    marcofrfam
    Accrued expenses are incurred but not yet paid or recorded. An accumulated depreciation account is a contra-asset account that increases on the debit side and is offset against total assets on the balance sheet. Unearned revenue is classified as a contra-revenue account. For the adjusting entry on September 30, Carter Guitar would debit interest expense for $90 and credit interest payable for $90. Prepaid expenses are expenses paid in advance. Expenses not yet paid or recorded are called accrued expenses.

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    Review Question Bis First year

    Accounting
    1- Accrued expenses are:
    a) Paid and recorded in an asset account before they are used or
    consumed.
    b) Paid and recorded in an asset account after they are used or
    consumed.
    c) Incurred but not yet paid or recorded.
    d) Incurred and already paid or recorded.
    2- An accumulated depreciation account:
    a) Is a contra-liability account. b) Increases on the debit side.
    c) Is offset against total assets on the balance sheet.
    d) Has a normal credit balance.
    3- Unearned revenue is classified as:
    a) An asset account. b) A revenue account.
    c) A contra-revenue account d) A liability.
    4-Carter Guitar Company borrowed $12,000 from the bank signing a 9%,
    3-month note on September 1. Principal and interest arc payable to the
    bank on December 1. If the company prepares monthly financial
    statements, the adjusting entry that the company should make for
    interest on September 30. would be:
    a) Debit Interest Expense, $1,080; Credit Interest Payable,$1,080.
    b) Debit Interest Expense, $90; Credit Interest Payable, $90.
    c) Debit Note Payable,$1,080; Credit Cash, $1,080.
    d) Debit Cash, $270; Credit Interest Payable, $270.
    5-Expenses paid in advance are called:
    a) Prepaid expenses. b) Expenses payable.
    c) Interim expenses. d)Unearned expenses.
    6-Expenses not yet paid or recorded are called:
    a) Prepaid expenses. b) Expenses payable.
    c) Interim expenses. d)Unearned expenses.
    |Page1
    7-Southeastern Louisiana University sold season tickets for the 2008
    football season for $160,000. A total of 8 games will be played during
    September, October and November. In September, three games were
    played. The adjusting journal entry at September 30.
    a) Is not required. No adjusting entries will be made until the end of the
    season in November.
    b) Will include a debit to Cash and a credit to Ticket Revenue for
    $40,000.
    c) Will include a debit to Unearned Ticket Revenue and a credit to Ticket
    Revenue for $60,000.
    d) Will include a debit to Ticket Revenue and a credit to Unearned Ticket
    Revenue for $53,333.
    8-Southeastern Louisiana University sold season tickets for the 2008
    football season for $160,000. A total of 8 games will be played during
    September, October and November. In September, two games were
    played. In October, three games were played. The balance in Unearned
    Revenue at October 31 is:
    a) $0.
    b) $40,000.
    c) $60,000.
    d) $100,000.

    prepared by Dr Eslam Nasr

    |Page2

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