Question 1. Question : Depreciation Expense and Accumulated Depreciation are classified, respectively, as

expense and contra asset

asset and contra liability

revenue and asset

contra asset and expense

Comments:

Question 2. Question : Which type(s) of adjustments are the financial statements affected by?

Deferrals

Accruals

Both deferrals and accruals

Neither deferrals nor accruals

Comments:

Question 3. Question : Accumulated depreciation is __________ to get the carrying value.

added to equipment

subtracted from equipment

added to accounts payable

subtracted from accounts payable

Comments:

Question 4. Question : The accounting equation is the basis for analyzing, summarizing, and recording transactions in accounting. The accounting equation is:

Assets =Liabilities

Assets = Liabilities + Stockholders Equity

Liabilities = Assets + Stockholders Equity

Stockholders Equity = Liabilities + Assets

Comments:

Question 5. Question : Accrual accounting records revenue when:

Earned

Cash is received

Products are completed

Salaries are paid

Comments:

Question 6. Question : On the balance sheet, Accrued expenses are ordinarily reported as:

Fixed assets

Prepaid expenses

Assets

Liabilities

Comments:

Question 7. Question : What are the four timing differences between recognizing revenues and expenses between accrual basis and cash basis accounting?

Accrued revenue, accrued expenses, deferred revenue, deferred expenses

Cash, revenue, expenses and liabilities

Accounts receivable, accounts payable, long term liabilities, intangible assets

Revenue, expenses, assets, retained earnings

Comments:

Question 8. Question : When cash is received in payment of an account receivable, which section of the Statement of Cash Flows is affected?

Cash Flow from Operating Activities

Cash Flow from Investing Activities

Cash Flow from Financing Activities

There is no effect on the Statement of Cash Flows.

Points Received: 0 of 2

Comments:

Question 9. Question : After recording transactions for the accounting period, which financial statement does a company prepares statement first?

Income statement

Balance sheet

Retained earnings statement

Statement of cash flows

Comments:

Question 10. Question : X&M Co. provided services of $2,000,000 to clients on account. How does this transaction affect A&M’s accounts?

Increase accounts receivable and cash by $2,000,000 each

Increase accounts receivable and unearned revenues by $2,000,000 each

Increase cash and decrease accounts receivable by $2,000,000 each

Increase accounts receivable and revenues by $2,000,000 each

Comments:

Question 11. Question : Cash receipts from interest and dividends are classified as

investing activities

operating activities

either financing or investing activities

financing activities

Comments:

Question 12. Question : ___________ is an example of a deferred expense.

Unearned revenue

Accounts payable

Prepaid advertising

Accounts receivable

Comments:

Question 13. Question : Using accrual accounting, expenses are recorded and reported only

When they are incurred and paid at the same time

When they are incurred, whether or not cash is paid

If they are paid before they are incurred

If they are paid after they are incurred

Comments:

Question 14. Question : Which of the following is an example of a deferred expense?

Prepaid advertising

Unearned revenue

Accounts payable

Accounts receivable

Comments:

Question 15. Question : Which transaction would be recordeKaplan MT203 Final Exam (Perfect Answer),Business & Finance,$20.00,

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