1. If long-term assets are not adjusted, expenses on the income statement A. Will be overstated. B....
Question:
1. If long-term assets are not adjusted, expenses on the income statement
A. Will be overstated.
B. Will be understated.
C. Will not be affected.
D. May be either overstated or understated.
2. On November 25, 2010, the company paid $24,000 rent in advance for a six-month period (December 2010 through May 2010). On December 31, 2010, the adjustment for expired rent would include
A. A $4,000 debit to Prepaid Rent.
B. A $4,000 credit to Rent Expense.
C. A $24,000 debit to Rent Expense.
D. A $4,000 credit to Prepaid Rent.
3. The adjusting entry to account for use of supplies consists of
A. A debit to Supplies Expense and a credit to Supplies.
B. A debit to Supplies and a credit to Supplies Expense.
C. A debit to Supplies and a credit to Accumulated Depreciation.
D. A debit to Accumulated Depreciation and a credit to Supplies.
4. The adjusting entry to account for use of prepaid insurance consists of
A. A debit to Insurance Expense and a credit to Prepaid Insurance.
B. A debit to Insurance Expense and a credit to Accumulated Depreciation.
C. A debit to Prepaid Insurance and a credit to Accumulated Depreciation.
D. A debit to Accumulated Depreciation and a credit to Prepaid Insurance.
5. The adjusting entry to account for use of prepaid advertising consists of
A. A debit to Prepaid Advertising and a credit to Advertising Expense.
B. A debit to Advertising Expense and a credit to Accumulated Depreciation.
C. A debit to Prepaid Advertising and a credit to Accumulated Depreciation.
D. A debit to Advertising Expense and a credit to Prepaid Advertising.
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