Question

best answer explanation

5. Reversing entries are most commonly used in relation to year-end adjusting entries that a. allocate the expired portion of a depreciable asset to expense. b. amortize intangible assets. c. provide for bad debt expense. d. accrue interest revenue on notes receivable 6 Of the following adjusting entries, which one would cause an increase in assets at the end of the period? a. The entry to record the earned portion of rent received in advance b. The entry to accrue unrecorded interest expense. c. The entry to accrue unrecorded interest revenue. d. The entry to record expiration of prepaid insurance. 7 Why is it necessary to make adjusting entries? a. The accountant has made errors in recording external transactions b. Certain facts about the affairs of the business are not included in the ledger as built up from external transactions. c. The accountant wants to show the largest possible net income for the period. d. The accountant wants to show the net cash flow for the year 8 Notes to financial statements should not be used to a describe the nature and effect of a change in accounting principles b. identify substantial differences between book and tax income C correct an improper financial statement presentation.

Answer 1

5]	d] accrue interest revenue on notes receivable
6]	c] the entry to accrue unrecorded interest revenue
7]	b] Certain facts about …...external transactions
8]	c] correct an improper financial statement presentation.