Question

EXTRA CREDIT QUESTION (10 POINTS) Complete the template for the expanded accounting equation below: Write in the classification of each T account. 2. Fill in the boxes to indicate whether each T account is added or subtracted. . Use the and -signs to indicate whether the debit or the credit increases () or decreases -) the acco Dr. Cr Dr. Cr Dr. Cr. Dr. Cr. MULTIPLE CHOICE (60 POINTS). Choose the best answer of the options provided. Record your answers with a #2 pencil on the Scantron form. Only answers recorded with a #2 pencil will count. 1) Unearned revenue is classified as what type of account? A) Revenue C) Prepaid Expense B) Expense D) Liability 2) A post-closing trial balance reports: A) All temporary and permanent ledger accounts with balances. B) Only revenue and expense accounts. C) Only asset accounts D) All permanent ledger accounts with balances. 3) The private-sector group that currently has the authority to establish generally accepted accounting principles (GAAP) in the United States is the A) AAA B) AICPA C) APB D) FASB 4) Depreciation: A) Is an outflow of cash from the use of a plant asset. B) Is the process of allocating the cost of a plant asset to expense. C) Is applied to land. D) Only applies to intangible assets. 5) The principles of internal control include: A) Use only computerized systems.

Answer 1

1. Unearned Revenue is a liability.

It is a liability account that reports amounts received in advance of providing goods or services. In accrual accounting, revenue is recorded when it is earned. When payment is received before the product is sold or the service is performed, it creates an obligation to earn the payment. This is also referred to as a liability. This liability is recorded by entering it in an account called "unearned revenue". The amount in this account is reduced as the money is earned.

Correct option is "D" Liability

2. A post closing trial balance reports all permanent ledger accounts with balances.

Trial Balance is prepared after the completion of all the ledgers. It contains assets, liabilities, expenses and revenues. After trial balance, Financial statements are prepared (Balance sheet and statement of income)

Correct option is "D" All permanent ledger accounts with balances.

3. Correct option is "D" FASB

The private sector group that currently has the authority to establish generally accepted accounting principles (GAAP) in the United States is FASB (Financial Accounting Standards Board)

4. Correct option is "B" Depreciation is the process of allocating the cost of a plant asset to expense.