1. All changes in account balances are caused by transactions between the business and another business or...
Question:
1. All changes in account balances are caused by transactions between the business and another business or individual.
1) True
2) False
2. Prepaid expenses, such as prepaid rent and prepaid insurance, represent assets for a business until they are used.
1) True
2) False
3. The cost of a long-term asset, such as equipment, is transferred to expense as it is used during its life.
1) True
2) False
4. If an adjustment is not recorded for supplies used, the firm's assets will be overstated.
1) True
2) False
5. If an adjustment for expired rent is not recorded, the firm's expenses will be overstated.
1) True
2) False
6. The normal balance of a contra asset account is a debit.
1) True
2) False
7. Letters are used to label the debit and credit parts of an adjustment on the worksheet.
1) True
2) False
8. Land is a long-term asset that is not subject to depreciation.
1) True
2) False
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones