Question

nnawers the question pelats each) Choose the one alternative that best completes the 1) Which of te tollowing is a per B) Advertising Expense D) Dividends A Retsined Larnings saction would not be recorded under cash-basis Paying salaries to ernployees B) 1 ing services to eustomers for cash ing supplies on account. one year of rent in advance C) Purchasing D) Paying ) The primary purpose of closing entries is to A) Ensure that all assets are 8) Update thase and liabilities are recognized in the appropriate period. C) Assure that adjusting entries balance. accoance of Retained Earnings and prepare revenue, expense, and transactions. e ove the equality of the debit and credit entries in the general journal. 4) An accrued expense occurs when: A) An B) Cash payment (or an obligation to pay expense is recorded at the same time as the cash payment. cash) occurs before the expense recognition. C) Cash is paid but an expense is never recorded. D) Cash payment occurs after the expense is recognized and a liability is reco 5) On A pril 1, a $4,800 premium on a one-year insurance policy on equipment wa and charged to Prepaid Insurance. At the end of the year, the financial statemern report: A) Insurance Expense, $4,800; Prepaid Insurance S0. B) Insurance Expense, $3,650; Prepaid Insurance $4,800. C) Insurance Expense, $3,600; Prepaid Insurance $1,200. D) Insurance Expense, $1,200; Prepaid Insurance $3,600.

Answer 1

following are the answers to the given questions. (As these questions includes theory in some places no explanation is needed in some questions)

1. (A) Retained Earnings

2. (C) Purchasing supplies on account

3. (A) Ensure that all the assets and liabilities are recognized in the appropriate period.

4. (D) Cash Payment occurs after the expense is recognized and a liability reco.

5. (C) Insurance expense $3600 , Prepaid Insurance $ 1200