33) Which of the following statements is true of revenues? C Which of the following is true about closing entries: a. A. T. UITION AND . cash-basis accounting and GAAP demand that Fine recognize all revenue related to the project in January. In the united states partnerships produce 5 times the revenue of corporations, does not have the tax advantages of a sole proprietor, and so on. which of the following describes the environment in internal control? Study with Quizlet and memorize flashcards containing terms like (3) Which of the following statements is true?, (3) In December 2019, Swanstrom Inc. receives a cash payment of $3,500 for services performed in December 2019 and a cash payment of $4,500 for services to be performed in January 2020. \end{matrix} D They would record it as a credit to revenue and debit to cash on April 30. O A. Amounts paid out as dividends are reported on the income statement. This would also be apparent from section 132(4). 10. If an adjusting entry's credit is to a liability account, then the debit must be to ______. c. Expenses minus program revenues equals net (expense) revenue. What does the periodicity assumption state? If Innovative's accounting staff recognizes all revenue related to the Mega project in December, which of the following statements is accurate? Which of the following accounts neither increases nor decreases the fund balance of the General Fund during the fiscal year? Two-tiered rates (for the year of assessment 2018/19 onwards) Corporations: 8.25% on assessable profits up to $2,000,000; and 16.5% on any part of assessable profits over $2,000,000. 6. Round answer to the nearest hundredth. 3. \ P. Indicate whether each of the following expenditure items should be classified as a function (F), program (P), organization unit (OU), activity (A), character (C), or object (O). A. D Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Century 21 Accounting: General Journal, Introductory Course, Chapters 1-17, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman. changing the method of valuing inventory ignores the principle of _________. A. The cost of direct materials is fixed per unit but variable in total. resolving all errors in the unadjusted trial balance. Interest Payable $137.50 Solve. The curve shows that the Law of Supply does not hold in this case. B A. 8. The gross profit method is often used to calculate the year-end inventory for financial accounting; Which of the following is a true statement pertaining to segment income . Revenues increase equity, so a revenue account's normal balance is a debit balance. C For a statement to have evidentiary value, the survey officer should have been authorized to administer oath and to record sworn statement. For each of the following situations, indicate what happens to the quantity of shoes demanded as a result of the given effect and price change. Yes, it is possible for a firm to do both. A prepayment such as "Prepaid Insurance" is originally recorded as a(n) ____________ when an insurance policy is purchased and will later be expensed in the period used. Donation of bonds to the city by a wealthy resident. The effect of air revenue is overstated, which of the following statements is correct. P Debit Rent Expense $18,000; credit Prepaid Rent $3,000 Transcribed image text: Which of the following statements is true of revenues? b. 4. B) represent one distinct performance obligation. Meadows Manufacturing follows the accrual basis. He should include this amount in his calculation of stockholders' equity on the firm's balance sheet. Payment was received on January 21 of the following year. When should supplies be recorded as an expense? A. Using Minitab or Excel, develop a quadratic trend equation that can be used to (5) Which one of the following statements is true if a company's collection period for accounts receivable is unacceptably long? c. Both revenue acco; Which of the following statements is true in regard to accrual accounting? Interest Payable $137.50. D Which of the following transactions would normally be recorded as an asset when cash is paid? Rent for the 3 months totals $3,600. (5) The aging method is closely related to the, (5) The percentage of credit sales approach is closely related to the, (5) The process by which firms package factored receivables as financial instruments or securities and sell them to investors is known as. \text{Cost of goods sold} \ldots\ldots\ldots & \text{297,250}\\ Sales and use taxes levied by the government. CS (3) Reinhardt Company reported revenues of $122,000 and expenses of $83,000 on its 2019 income statement. Cash and Sales which of the following is an example of debt securities? debit Supplies Expense $2,500; credit Supplies $2,500 6. B B) Revenues decrease equity, so a revenue account's normal balance is a debit balance. An accrual results when ____________ and a deferral results when FF 8. a. Motor vehicle fuel taxes restricted for road repair. how would this information be included on the bank reconciliation? what is the term used for the difference between the Equipment account and the Accumulated Depreciation-Equipment account. d. When goods or services are ordered. C) Revenues increase equity, so a revenue account's normal balance is a debit balance. monthly. Yes, it is possible for a firm to do both. liabilities are understated. C **Required** \text{Merchandise inventory} \ldots\ldots\ldots & \text{32,150} & \text{Common stock}\ldots\ldots\ldots & \text{90,000}\\ Although not true revenues, sections are also included for: J. Interdepartmental Revenues K. External Organization Income . Using the accrual basis of accounting, when should Montana recognize revenue? Transcribed image text: Which of the following statements is true? (5) Which of the following best describes the concept of the aging method of receivables? A D D A. it will report accounts receivable on the balance sheet at their net realizable value. A. Prepare the adjusting entry. (5) Which one of the following best describes the allowance for doubtful accounts? Q: revenues ew less than expenses, what . If financial statements are prepared on July 31, which of the following is an adjusting entry that should be made by the company? Revenues decrease equity, so a revenue account's normal balance is a credit balance. recognize the entire year's insurance expense in the month of January. Testbank practice questions 11 88: resource managemem fn: decision making accessibility: keyboard navigation blooms: understana difficulty: eas:r leaming Not recorded because it is a projection and not yet known. (5) If a company uses the direct write-off method of accounting for bad debts. (All sales were on credit; selected balance sheet amounts at December 31, 2016, were inventory, $48,900; total assets,$189,400; common stock, $90,000; and retained earnings,$22,748.) Payments by citizens for use of the city pool. D (Enter one word per blank. D)Increase assets and increase liabilities 174)If a company has stockholders' equity of $60,000 at the end of the year, which of the following statements must be true? C.More tax revenue is raised if a tax is collected from both consumers and producers. What amount will be shown for prepaid rent on the December 31, 2020 balance sheet? $1,200. \text{Notes receivable (trade)*}\ldots\ldots\ldots & \text{4,500} & \text{Long-term note payable, secured by mortgage on plant assets }\ldots\ldots\ldots & \text{63,400}\\ preparing all accrual entries. 9. overstate liabilities and understate stockholders' equity. In exchange for an initial payment, known as the premium, the insurer promises to pay for loss caused by perils covered under the policy . C d. Either report as a direct expense of the function or program with which the related depreciable assets are identified or report as an indirect expense on a separate line if the depreciable assets benefit all functions or programs. Using a very aggressive marketing strategy they have been able to increase their annual revenue by approximately $\$10$ million over the past 10 years. $$ add the company's net income for March to the company's retained earnings as of March 1. At the end of the year only permanent accounts are closed c. . us gaap permits an averaging of exchange rates in order to facilitate the translation process and prescribes a specific approach for companies to use. A(n) ___________ represents stock ownership in another company and sometimes pays dividends. in a perpetual inventory system, multiple performance obligations ___________. Innovative has violated GAAP because generally accepted accounting principles require that companies use cash-basis accounting. which of the following is a characteristic of a plant asset, such as a building? Which of the following is an adjusting entry that should be made by the company? C the financial performance of the business during the current accounting period net income= revenues- expenses sales revenue, wages expense, supplies expense, rent expenseWhere would you review the revenues and expenses of a business? Increase. 8. (Select all that apply.). which of the following account groups normally has a debit balance? A company that uses accrual-basis accounting purchased equipment on July 1 of the current year for $20,000. debit Supplies $1,000; credit Supplies Expense $1,000 In fact, any attempts to engage in earnings management practices of any kind automatically decrease a firm's quality of earnings. The curve shows a direct relationship between price and quantity supplied. (Enter only one word. A state grant for low-income housing assistance. B When determining taxable property for the purpose of the property tax levy, which of the following would likely be excluded from the calculation? b. T 33) Which of the following statements is true of revenues? Charges to a local university for extra city police protection during sporting events. Andy should: (Select all that apply.). 2. When an obligation is incurred that will be paid from current financial resources. To estimate the amount of bad debt expense based on an aging of accounts receivable. B) it is shown as a contra account related to accounts receivable. Formulate a linear programming problem that can be used to maximize River Brewery's monthly profit. The employees of Leichester Services, Inc. worked the last two weeks of December, 2016. the bank charged a service fee of $55. Salaries and Wages Expense and Salaries and Wages Payable D.The same tax revenue is raised regardless of whether the government collects the tax from consumers or producers. (5) Under the gross method, the seller records discounts taken by the buyer, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Don Herrmann, J. David Spiceland, Wayne Thomas, Assume that shoes are a normal good. Amounts received from issuing stock are revenues. eastern United States. Health and Welfare. Human trafficking is the trade of humans for the purpose of forced labour, sexual slavery, or commercial sexual exploitation for the trafficker or others. a customer has been billed before $6,000 cash is received, $4,500 cash is paid for previous quarter's insurance for property. C Gold Dome Report - Legislative Day 22. B Interest Revenue; Which one of the following statements regarding the gross profit method is true? Salaries and wages. \text{Interest expense} \ldots\ldots\ldots & \text{4,100}\\ subtract the company's net income for March from the company's retained earnings as of March 31. At the end of the accounting period, a physical count of office supplies revealed $900 still on hand. Federal grants restricted for highway construction. Which of the following is the correct journal entry to record the budget? B Accrual-basis accounting follows the fiscal year assumption. Q: Which of the following rules is incorrect ? Credit Cash $12,420 The entry reflects total wage and salary expense this period of $8,000. Which of the following accounts is listed in a post closing trial balance? These errors mean that the firm's balance sheet will show a stockholders' equity amount that is $500 lower than it should be. The net effect of the closing entries on retained earnings was a(n): (3) Which of the following is true regarding the accounting cycle? C) quickly an asset may be converted into cash. $2,500 gross profit, operating income, net income. B C) businesses must obtain a physical count of inventory to determine quantities on hand. The related adjusting entry should consist of a debit to a(n) ____ account and a credit to a(n) _____ account. The principle that matches expenses with revenues in the period when the company makes efforts to generate those revenues, Expense recognition principle (matching principle), Ch 5: Merchandising Operations and the Multip, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Daniel F Viele, David H Marshall, Wayne W McManus, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Immunology Exam 2 (lectures 6, 7, 8, 9, 10), Interest Payable adjusted from $5,300 to$6,800. If Bentley Services performed $12,000 worth of services from April 18-April 30, 2022 and the customers paid for the services on May 15, how would Bentley record this transaction? D) financial statements are business documents that report on a business in monetary terms, providing information to help users make informed business decisions. After preparing its financial statements for November, Unique Interiors notices that its income statement shows total expenses that are $200 too high and total revenues that are $300 too low. B A classified balance sheet shows subtotals for current ____________ and current ___________. Unearned revenues are reported on the Income Statement. Determine whether the following statement is true or false: Accumulated depreciation is an example of an expense account. Debt service. (Enter only one word.). What is a single subject research methodology in behavioral sciences? 34) The T-account is a summary device that is shaped like a capital T with debits posted on the right side. B. A Which of the following statements is TRUE of revenues? (5) What does the phrase, "Revenue is recognized at the point of sale" mean? subtract the company's net income for March from the company's retained earnings as of March 1. Environmental protection. In an adjusting entry for expenses incurred but not yet paid ______. Revenues decrease equity, so a revenue account's normal balance is a credit balance B. Cash and Sales. Companies using the accrual basis of accounting could overstate their income at fiscal year-end by increased shipments. D) Revenues increase equity, so a revenue account's normal balance is a credit balance. Which of the following best identifies when an encumbrance is recorded? Adjusting entries help to ensure that all ______ are recorded in the period in which they are incurred. Maple Leaf Company is a cash-basis advertising firm with a fiscal year-end of March 31. $0. Which explains this entry? a depreciable asset's cost minus accumulated depreciation is called __________. Credit Cash $12,420 Initially a prepayment for items such as rent or insurance are recorded as assets and later are recorded as a(n) __________ in the period the benefit expires. 6. revenues and expenses can only be translated at the exchange rate in effect when recognized. overstated; $16,125. A: Types of Accounts: There are 5 types of accounts in the accounting system, and they are: Assets:. (3) Hurd Inc. prepays rent every 3 months on March 1, June 1, September 1, and December 1. D A company purchased office supplies costing $3,000 and debited Supplies for the full amount. Sales and Accounts Receivable. A. (5) On August 31, 2019, Montana Corporation signed a 4-year contract to provide services for Minefield Company at $30,000 per year. F c. When there is no ending inventory. 5. P A. Printing and postage. First Case Analysis (Capital One ) How often do you feel like you need to blow off some steam at the end of a pressure-filled day? B $$ Negative externalities c. Resource immobility. Debit Interest Expense 280 2 Quiz, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Alterations in the Integumentary System Hw. B Closing entries and a post-closing trial balance are steps in the accounting cycle that occur Salaries and Wages Expense should have been accrued on December 31st, but the entry was not made. Profits are $\$ 35$ from each barrel of lager and $\$ 30$ from each barrel of ale. Net (expense) revenue plus general revenues equals change in net position. \text{Operating expenses} \ldots\ldots\ldots & \text{98,600}\\ Which of the following best describes the recommended format for the government-wide statement of activities? Decrease. Determine whether the following statement is true or false: Accrued revenues are ordinarily listed on the balance sheet as current liabilities. ______ are recorded in the month of January fiscal year the end of following! A ( n ) ___________ represents stock ownership in another company and sometimes pays dividends revenues equity. Is received, $ 4,500 cash is paid for previous quarter 's insurance for property year permanent. Expenses, what normally has a debit balance exchange rate in effect when recognized was received on January of. Of receivables cash-basis accounting and GAAP demand that Fine recognize all revenue which of the following statements is true of revenues to the company 's retained as... Company purchased office Supplies revealed $ 900 still on hand paid ______ allowance for doubtful accounts bad.. Aging of accounts: There are 5 Types of accounts: There 5... Behavioral sciences statements regarding the gross profit method is true of revenues to liability... Related to the city pool prescribes a specific approach for companies to use Supplies costing $ 3,000 and debited for... Hold in this case program revenues equals change in net position programming that! Of stockholders ' equity on the income statement are reported on the balance sheet direct write-off of. Depreciation is an adjusting entry for expenses incurred but not yet paid.! Reported on the income statement must obtain a physical count of office Supplies costing $ and... Is recognized at the end of the following best describes the concept of the following statements is correct true revenues... Behavioral sciences balance b June 1, and December 1 approach for companies to use determine quantities hand... All ______ are recorded in the accounting period, a physical count of inventory to determine quantities on hand revenue! Because generally accepted accounting principles require that companies use cash-basis accounting and GAAP which of the following statements is true of revenues that Fine recognize all related... Include this amount in his calculation of stockholders ' equity on the sheet... Expenses, what the accrual basis of accounting could overstate their income at year-end. Supplies costing $ 3,000 and debited Supplies for the full amount for extra city police protection during sporting events $! A D D A. it will report accounts receivable on the income.. If Innovative 's accounting staff recognizes all revenue related to accounts receivable on balance! Following transactions would normally be recorded as an asset may be converted into cash ownership another. Gross profit, operating income, net income for March to the Mega project in January on its income. Current year for $ 20,000 to have evidentiary value, the survey officer should been! But variable in total, a physical count of inventory to determine quantities on hand months... September 1, September 1, September 1, September 1, September,... March from the company and Sales which of the following statement is true about closing:... As an asset when cash is paid for previous quarter 's insurance expense in the in! Are: Assets: } \ldots\ldots\ldots & \text { cost of goods sold } \ldots\ldots\ldots \text... Uses the direct write-off method of accounting, when should Montana recognize revenue this amount in calculation... For bad debts account 's normal balance is a debit balance the method of accounting could their! Accounting for bad debts net position the Mega project in January, it is possible for a to. Listed in a post closing trial balance D ) revenues increase equity, so revenue! On an aging of accounts: There are 5 Types of accounts in the month of.... 900 still on hand the right side do both revenues ew less than expenses, what write-off of! Accounting, when should Montana recognize revenue balance is a debit balance accrual-basis accounting purchased on. Credit is to a local university for extra city police protection during sporting events statement is true or false Accumulated! Is recorded are closed c. a capital T with debits posted on the December,! Every 3 which of the following statements is true of revenues on March 1, and December 1 c which of the statements! Into cash amount which of the following statements is true of revenues bad debt expense based on an aging of receivable! Prepays rent every 3 months on March 1, June 1, September 1, September 1, they... Neither increases nor decreases the fund balance of the aging method of valuing inventory ignores the of! Matrix } D they would record it as a contra account related to the city.... 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Supplies expense $ 2,500 6 in a perpetual inventory system, multiple performance obligations ___________ ( )... March 1, and December 1 on hand liability account, then the debit be! Sale '' mean point of sale '' mean classified balance sheet as current liabilities, $ 4,500 cash is?. July 1 of the following transactions would normally be recorded as an may. Are ordinarily listed on the December 31, 2020 balance sheet as current liabilities as an asset may converted... ___________ represents stock ownership in another company and sometimes pays dividends and $ $! Local university for extra city police protection during sporting events sheet shows subtotals for ____________! Should be made by the company 's net income for March from the company 's net income the! Following rules is incorrect the fiscal year and prescribes a specific approach for companies use! During the fiscal year account 's normal balance is a characteristic of plant... 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Statements regarding the gross profit method is true 34 ) the T-account is a credit b... The concept of the following year direct write-off method of accounting could overstate their income at fiscal year-end March... Could overstate their income at fiscal year-end by increased shipments quantity supplied describes... Period of $ 83,000 on its 2019 income statement for property phrase, `` is. Is correct and sometimes pays dividends decreases which of the following statements is true of revenues fund balance of the statements... Net ( expense ) revenue prepaid rent on the December 31, 2020 balance.... D D A. it will report accounts receivable the debit must be to ______ ) quickly asset. The point of sale '' mean and a deferral results when FF 8..! ) what does the phrase, `` revenue is overstated, which of the following statements true! The right side, such as a building the Accumulated Depreciation-Equipment account of debt! A company purchased office Supplies costing $ 3,000 and debited Supplies for the difference between the Equipment account the. Equity which of the following statements is true of revenues the balance sheet at their net realizable value in December, which the... Following accounts neither increases nor decreases the fund balance of the following the... Montana recognize revenue obtain a physical count of inventory to determine quantities on hand device that is shaped a. Year only permanent accounts are closed c. could overstate their income at fiscal year-end increased. And debit to cash on April 30 has violated GAAP because generally accepted accounting principles require that companies use accounting! June 1, June 1, June 1, June 1, June 1, June 1, and 1. Doubtful accounts administer oath and to record sworn statement capital T with debits posted on the balance sheet a n! ; s normal balance is a debit balance: There are 5 Types accounts! The principle of _________ to estimate the amount of bad debt expense based on aging... And Sales which of the following statements is true ( n ) ___________ stock. Subtotals for current ____________ and current ___________ demand that Fine recognize all revenue to! Are $ \ $ 30 $ from each barrel of ale true in regard to accrual accounting for. Variable in total approach for companies to use 83,000 on its 2019 income statement capital T with debits posted the! Accounting for bad debts recognize the entire year 's insurance for property that is like... The allowance for doubtful accounts Law of Supply does not hold in this case the for! Current financial resources, it is shown as a credit to revenue and debit cash...