THE ACCOUNTING INFORMATION SYSTEM
THE ACCOUNTING INFORMATION SYSTEM
IFRS questions are available at te
IFRS questions are available at te en! o" tis #a$ter%en! o" tis #a$ter%
TRUE&FA'SE
TRUE&FA'SE
A
Annss((eerr NNoo%% ))eess##rrii$$ttiioonn F
F 11.. RReeccoorrddiinng g ttrraannssaaccttiioonnss.. T
T 22.. NNoommiinnaal l aaccccoouunnttss.. F
F 33.. RReeaal l ((ppeerrmmaanneenntt) ) aaccccoouunnttss.. F
F 44.. IInntteerrnnaal l eevveennt t eexxaammppllee.. F
F 55.. iiaa!!iilliitt" " aannd d ssttoocc##$$oollddeerrss% % ee&&uuiitt" " aaccccoouunnttss.. F
F ''.. ee!!iitts s aannd d ccrreeddiittss.. F
F .. **tteepps s iin n aaccccoouunnttiinng g cc""ccllee.. T
T ++.. ,,uurrppoosse e oo- - ttrriiaal l !!aallaannccee.. T
T .. //eenneerraal l 00oouurrnnaall.. F
F 11.. ,,oossttiinng g aannd d ttrriiaal l !!aallaannccee.. T
T 1111.. dd00uussttiinng g eennttrriiees s --oor r pprreeppaa""mmeennttss.. T
T 1122.. xxaammpplle e oo- - aaccccrruueed d eexxppeennssee.. F
F 1133.. oooo# # vvaalluue e oo- - ddeepprreecciiaa!!lle e aasssseettss.. T
T 1144.. RReeppoorrttiinng g eennddiinng g rreettaaiinneed d eeaarrnniinnggss.. F
F 1155.. ,,oossttcclloossiinng g ttrriiaal l !!aallaannccee.. F
F 11''.. ,,oossttiinng g cclloossiinng g eennttrriieess.. T
T 11.. 66lloossiinng g eennttrriiees s aannd d IInnccoomme e **uummmmaarr"".. F
F 7711++.. ccccrruuaal l !!aassiis s aaccccoouunnttiinngg.. F
F 7711.. ,,uurrppoosse e oo- - rreevveerrssiinng g eennttrriieess.. F
F 7722.. dd00uusstteed d ttrriiaal l !!aallaannccee..
MU'TIP'E CHOICE
MU'TIP'E CHOICE
*Con#e$tual
*Con#e$tual
A
Annss((eerr NNoo%% ))eess##rrii$$ttiioonn d
d 2211.. ,,uurrppoosse e oo- - aan n aaccccoouunnttiinng g ss""sstteemm.. d
d 2222.. ee--iinniittiioon n oo- - ppoossttiinngg.. d
d 2233.. ,,uurrppoosse e oo- - aan n aaccccoouunnttiinng g ss""sstteemm.. d
d 2244.. oooo# # oo- - oorriiggiinnaal l eennttrr"".. d
d 2255.. ,,uurrppoosse e oo- - ttrriiaal l !!aallaannccee.. d
d 22''.. IIddeennttii--iiccaattiioon n oo- - a a rreeaal l aaccccoouunntt.. !
! 22.. IIddeennttii--iiccaattiioon n oo- - a a tteemmppoorraarr" " aaccccoouunntt.. a
a 22++.. TTeemmppoorraarr" " aaccccoouunnttss..
cc 22.. oouu!!lleeeennttrr" " aaccccoouunnttiinng g ss""sstteemm.. cc 33.. oouu!!lleeeennttrr" " ss""sstteemm..
a
a 3311.. ----eecct t oon n ssttoocc##$$oollddeerrss% % ee&&uuiitt"".. a
a 3322.. TTrraannssaaccttiioon n aannaall""ssiiss.. a
a 3333.. ccccoouunnttiinng g ee&&uuaattiioonn.. !
d
d 3355.. ccccoouunnttiinng g cc""cclle e sstteeppss.. d
d 33''.. 66rriitteerriia a --oor r rreeccoorrddiinng g eevveennttss.. d
d 33.. IIddeennttii--iiccaattiioon n oo- - a a rreeccoorrddaa!!lle e eevveenntt.. cc 33++.. IIddeennttii--iiccaattiioon n oo- - iinntteerrnnaal l eevveennttss.. d
d 33.. xxtteerrnnaal l eevveennttss.. d
d 44.. iimmiittaattiioonns s oo- - ttrriiaal l !!aallaannccee.. a
a 4411.. //eenneerraal l 00oouurrnnaall.. ! ! 4422.. 88oouurrnnaal l eennttrr"".. cc 4433.. 88oouurrnnaal l eennttrr"".. d d 4444.. 88oouurrnnaal l eennttrr"".. d
d 4455.. IImm!!aallaanncce e iin n a a ttrriiaal l !!aallaannccee.. d
d 44''.. ,,uurrppoosse e oo- - uunnaadd00uusstteed d ttrriiaal l !!aallaannccee.. !
! 44.. FFoorrmmaat t oo- - aadd00uussttiinng g eennttrr"".. !
! 44++.. xxaammpplle e oo- - aaccccrruueed d eexxppeennssee.. d
d 44.. ccccrruuaall!!aassiis s oo- - aaccccoouunnttiinngg.. cc 55.. ccccrruueed d eexxppeennsse e aadd00uussttiinng g eennttrr"".. a
a 5511.. ----eecct t oo- - nnoot t rreeccoorrddiinng g aaccccrruueed d eexxppeennssee.. !
! 5522.. eessccrriippttiioon n oo- - a a ddee--eerrrraall.. d
d 5533.. ----eecct t oo- - nnoot t rreeccoorrddiinng g aaccccrruueed d rreevveennuuee.. a
a 5544.. ----eecct t oo- - nnoot t rreeccoorrddiinng g ddeepprreecciiaattiioon n eexxppeennssee.. a
a 5555.. TTiimmiinng g oo- - aadd00uussttmmeennttss.. a
a 55''.. ,,rreeppaaiid d eexxppeennssee.. a
a 55.. xxppiirraattiioon n oo- - pprreeppaaiid d eexxppeennsseess.. !
! 55++.. ----eecct t oo- - ddeepprreecciiaattiioon n eennttrr"".. a
a 55.. 99nneeaarrnneed d rreevveennuue e rreellaattiioonnss$$iippss.. a
a ''.. 66oommppuuttaattiioon n oo- - iinntteerreesst t eexxppeennsse e --oor r aadd00uussttiinng g eennttrr"".. d
d ''11.. ,,uurrppoosse e oo- - aadd00uussttiinng g eennttrriieess.. cc ''22.. ::aattcc$$iinng g pprriinncciippllee..
a
a ''33.. ,,rreeppaaiid d iitteemmss.. d
d ''44.. ccccrruueed d iitteemmss..
cc ''55.. ee--iinniittiioon n oo- - uunneeaarrnneed d rreevveennuuee.. d
d ''''.. ee--iinniittiioon n oo- - aaccccrruueed d eexxppeennssee..
cc ''.. dd00uussttiinng g eennttrr" " --oor r aaccccrruueed d eexxppeennssee.. d
d ''++.. FFaaccttoorrs s tto o ccoonnssiiddeer r iin n eessttiimmaattiinng g ddeepprreecciiaattiioonn.. d
d ''.. dd00uussttiinng g eennttrriieess.. d
d .. ----eecct t oo- - aadd00uussttiinng g eennttrriieess.. !
! 11.. ,,rreeppaaiid d eexxppeennsse e aannd d tt$$e e mmaattcc$$iinng g pprriinncciippllee.. cc 22.. ccccrruueed d rreevveennuue e aannd d tt$$e e mmaattcc$$iinng g pprriinncciippllee.. !
! 33.. 99nneeaarrnneed d rreevveennuue e aannd d tt$$e e mmaattcc$$iinng g pprriinncciippllee.. !
! 44.. dd00uusstteed d ttrriiaal l !!aallaannccee.. cc 55.. 66lloossiinng g pprroocceessss..
cc ''.. ,,uurrppoosse e oo- - cclloossiinng g eennttrriieess.. d
d .. 66aass$ $ ccoolllleeccttiioonns s vvss. . rreevveennuue e rreeccooggnnii;;eedd.. d
d 77++.. 66aass$$!!aassiis s rreevveennuuee..
cc 77.. 66oonnvveerrt t ccaass$ $ rreecceeiipptts s tto o sseerrvviicce e rreevveennuuee.. cc 77++.. 66oonnvveerrt t ccaass$ $ ppaaiid d --oor r ooppeerraattiinng g eexxppeennsseess.. cc 77++11.. ,,uurrppoosse e oo- - rreevveerrssiinng g eennttrriieess..
d
d 77++22.. IIddeennttii--iiccaattiioon n oo- - rreevveerrssiinng g eennttrriieess.. d
d 77++33.. IIddeennttii--iiccaattiioon n oo- - rreevveerrssiinng g eennttrriieess.. !
! 77++44.. dd00uussttiinng g eennttrriiees s rreevveerrsseedd.. d
d
d 3355.. ccccoouunnttiinng g cc""cclle e sstteeppss.. d
d 33''.. 66rriitteerriia a --oor r rreeccoorrddiinng g eevveennttss.. d
d 33.. IIddeennttii--iiccaattiioon n oo- - a a rreeccoorrddaa!!lle e eevveenntt.. cc 33++.. IIddeennttii--iiccaattiioon n oo- - iinntteerrnnaal l eevveennttss.. d
d 33.. xxtteerrnnaal l eevveennttss.. d
d 44.. iimmiittaattiioonns s oo- - ttrriiaal l !!aallaannccee.. a
a 4411.. //eenneerraal l 00oouurrnnaall.. ! ! 4422.. 88oouurrnnaal l eennttrr"".. cc 4433.. 88oouurrnnaal l eennttrr"".. d d 4444.. 88oouurrnnaal l eennttrr"".. d
d 4455.. IImm!!aallaanncce e iin n a a ttrriiaal l !!aallaannccee.. d
d 44''.. ,,uurrppoosse e oo- - uunnaadd00uusstteed d ttrriiaal l !!aallaannccee.. !
! 44.. FFoorrmmaat t oo- - aadd00uussttiinng g eennttrr"".. !
! 44++.. xxaammpplle e oo- - aaccccrruueed d eexxppeennssee.. d
d 44.. ccccrruuaall!!aassiis s oo- - aaccccoouunnttiinngg.. cc 55.. ccccrruueed d eexxppeennsse e aadd00uussttiinng g eennttrr"".. a
a 5511.. ----eecct t oo- - nnoot t rreeccoorrddiinng g aaccccrruueed d eexxppeennssee.. !
! 5522.. eessccrriippttiioon n oo- - a a ddee--eerrrraall.. d
d 5533.. ----eecct t oo- - nnoot t rreeccoorrddiinng g aaccccrruueed d rreevveennuuee.. a
a 5544.. ----eecct t oo- - nnoot t rreeccoorrddiinng g ddeepprreecciiaattiioon n eexxppeennssee.. a
a 5555.. TTiimmiinng g oo- - aadd00uussttmmeennttss.. a
a 55''.. ,,rreeppaaiid d eexxppeennssee.. a
a 55.. xxppiirraattiioon n oo- - pprreeppaaiid d eexxppeennsseess.. !
! 55++.. ----eecct t oo- - ddeepprreecciiaattiioon n eennttrr"".. a
a 55.. 99nneeaarrnneed d rreevveennuue e rreellaattiioonnss$$iippss.. a
a ''.. 66oommppuuttaattiioon n oo- - iinntteerreesst t eexxppeennsse e --oor r aadd00uussttiinng g eennttrr"".. d
d ''11.. ,,uurrppoosse e oo- - aadd00uussttiinng g eennttrriieess.. cc ''22.. ::aattcc$$iinng g pprriinncciippllee..
a
a ''33.. ,,rreeppaaiid d iitteemmss.. d
d ''44.. ccccrruueed d iitteemmss..
cc ''55.. ee--iinniittiioon n oo- - uunneeaarrnneed d rreevveennuuee.. d
d ''''.. ee--iinniittiioon n oo- - aaccccrruueed d eexxppeennssee..
cc ''.. dd00uussttiinng g eennttrr" " --oor r aaccccrruueed d eexxppeennssee.. d
d ''++.. FFaaccttoorrs s tto o ccoonnssiiddeer r iin n eessttiimmaattiinng g ddeepprreecciiaattiioonn.. d
d ''.. dd00uussttiinng g eennttrriieess.. d
d .. ----eecct t oo- - aadd00uussttiinng g eennttrriieess.. !
! 11.. ,,rreeppaaiid d eexxppeennsse e aannd d tt$$e e mmaattcc$$iinng g pprriinncciippllee.. cc 22.. ccccrruueed d rreevveennuue e aannd d tt$$e e mmaattcc$$iinng g pprriinncciippllee.. !
! 33.. 99nneeaarrnneed d rreevveennuue e aannd d tt$$e e mmaattcc$$iinng g pprriinncciippllee.. !
! 44.. dd00uusstteed d ttrriiaal l !!aallaannccee.. cc 55.. 66lloossiinng g pprroocceessss..
cc ''.. ,,uurrppoosse e oo- - cclloossiinng g eennttrriieess.. d
d .. 66aass$ $ ccoolllleeccttiioonns s vvss. . rreevveennuue e rreeccooggnnii;;eedd.. d
d 77++.. 66aass$$!!aassiis s rreevveennuuee..
cc 77.. 66oonnvveerrt t ccaass$ $ rreecceeiipptts s tto o sseerrvviicce e rreevveennuuee.. cc 77++.. 66oonnvveerrt t ccaass$ $ ppaaiid d --oor r ooppeerraattiinng g eexxppeennsseess.. cc 77++11.. ,,uurrppoosse e oo- - rreevveerrssiinng g eennttrriieess..
d
d 77++22.. IIddeennttii--iiccaattiioon n oo- - rreevveerrssiinng g eennttrriieess.. d
d 77++33.. IIddeennttii--iiccaattiioon n oo- - rreevveerrssiinng g eennttrriieess.. !
! 77++44.. dd00uussttiinng g eennttrriiees s rreevveerrsseedd.. d
MU'TIP'E CHOICE
MU'TIP'E CHOICE
*Co-$utational
*Co-$utational
A
Annss((eerr NNoo%% ))eess##rrii$$ttiioonn
cc ++''.. ----eecct t oo- - ttrraannssaaccttiioonns s oon n oo<<nneerrss% % ee&&uuiitt"".. cc ++.. ----eecct t oo- - ttrraannssaaccttiioonns s oon n oo<<nneerrss% % ee&&uuiitt"".. cc ++++.. 99nneeaarrnneed d rreennt t aadd00uussttmmeenntt..
cc ++.. 99nneeaarrnneed d rreennt t aadd00uussttmmeenntt.. d
d .. eetteerrmmiinne e aadd00uussttiinng g eennttrr"".. cc 11.. dd00uussttiinng g eennttrr" " --oor r !!aad d ddee!!ttss.. !
! 22.. dd00uussttiinng g eennttrr" " --oor r !!aad d ddee!!ttss..
cc 33.. dd00uussttiinng g eennttrr" " --oor r iinntteerreesst t rreecceeiivvaa!!llee.. cc 44.. **uu!!ssee&&uueennt t ppeerriiood d eennttrr" " --oor r iinntteerreesstt.. d
d 7755.. 99sse e oo- - rreevveerrssiinng g eennttrr"".. d
d ''.. dd00uussttiinng g eennttrr" " --oor r uunneeaarrnneed d rreenntt.. !
! .. dd00uussttiinng g eennttrr" " --oor r ssuupppplliieess.. d
d ++.. ----eecct t oo- - cclloossiinng g eennttrriieess.. !
! 77.. 66aallccuullaatte e ccaass$ $ rreecceeiivveed d --oor r iinntteerreesstt.. !
! 7711.. 66aallccuullaatte e ccaass$ $ ppaaiid d --oor r ssaallaarriieess.. d
d 771111.. 66aallccuullaatte e ccaass$ $ ppaaiid d --oor r iinnssuurraannccee.. cc 771122.. 66aallccuullaatte e iinnssuurraanncce e eexxppeennssee.. cc 771133.. 66aallccuullaatte e iinntteerreesst t rreevveennuuee.. cc 771144.. 66aallccuullaatte e ssaallaarr" " eexxppeennssee.. d
d 771155.. dd00uussttiinng g eennttrr" " --oor r ssuupppplliieess.. cc 7711''.. RReevveerrssiinng g eennttrriieess..
!
! 7711.. 99nneeaarrnneed d rreennt t aadd00uussttmmeenntt.. a
a 7711++.. eetteerrmmiinne e aadd00uussttiinng g eennttrr"".. d
d 7711.. eetteerrmmiinne e aadd00uussttiinng g eennttrr""..
MU'TIP'E CHOICE
MU'TIP'E CHOICE
*CPA A
*CPA A!a$t
!a$te!
e!
A
Annss((eerr NNoo%% ))eess##rrii$$ttiioonn
cc 1111.. eetteerrmmiinne e aaccccrruueed d iinntteerreesst t ppaa""aa!!llee.. !
! 111111.. eetteerrmmiinne e !!aallaanncce e oo- - uunneeaarrnneed d rreevveennuueess.. a
a 111122.. 66aallccuullaatte e ssuu!!ssccrriippttiioonns s rreevveennuuee.. cc 111133.. eetteerrmmiinne e iinntteerreesst t rreecceeiivvaa!!llee.. !
! 111144.. 66aallccuullaatte e !!aallaanncce e oo- - aaccccrruueed d ppaa""aa!!llee.. !
! 111155.. 66aallccuullaatte e aaccccrruueed d ssaallaarriieess.. a
a 1111''.. 66aallccuullaatte e rroo""aalltt" " rreevveennuuee.. d
d 1111.. 66aallccuullaatte e ddee--eerrrreed d rreevveennuuee.. !
! 771111++.. ii----eerreenncce e !!eett<<eeeen cn caass$$!!aassiis s aannd d aaccccrruuaal l mmeett$$oodd.. cc 771111.. eetteerrmmiinne e ccaass$$!!aassiis s rreevveennuuee..
!
! 771122.. eetteerrmmiinne e aaccccrruuaall!!aassiis s rreevveennuuee.. a
a 77112211.. 66aallccuullaatte e ccoosst t oo- - ggoooodds s ssoolldd.. 7T$is topic is dealt <it$ in an ppendix to t$e
+RIEF E2ERCISES
+RIEF E2ERCISES
IIttee-- ))eess##rrii$$ttiioonn
33112222 ee--iinniittiioonnss..
33112233 TTeerrmmiinnoolloogg""..
33112244 ccccrruueed d aannd d ddee--eerrrreed d iitteemmss..
E2ERCISES
E2ERCISES
33112255 dd00uussttiinng g eennttrriieess..
331122'' dd00uussttiinng g eennttrriieess..
331122 FFiinnaanncciiaal l ssttaatteemmeennttss..
7733112+2+ 6a6ass$$!a!assis is vsvs. . acacccrurualal!!asasis is acaccocoununttining.g. 77331122 ccccrruuaal l !!aassiiss.. 77331133 ccccrruuaal l !!aassiiss.. 7733113311 ccccrruuaal l !!aassiiss.. 7733113322 66aass$ $ !!aassiiss..
PRO+'EMS
PRO+'EMS
IIttee-- ))eess##rrii$$ttiioonn ,3
,3113333 dd0u0usstiting ng enentrtrieies s anand ad acccocoununt ct clalasssisi-i-iccatatioionsns.. ,
,33113344 dd00uussttiinng g eennttrriieess.. ,
,33113355 dd00uussttiinng g aannd d cclloossiinng g eennttrriieess.. 77,,331133'' 66aass$ t$ to o aaccccrruuaal l aaccccoouunnttiinngg.. 77,,331133 ccccrruuaal al accccoouunnttiinngg..
77,,331133++ ccccrruuaal al accccoouunnttiinngg.. 77,,331133 iigg$$ttccoolluummn n <<oorr# # ss$$eeeett..
CHAPTER 'EARNING O+ECTI4ES
CHAPTER 'EARNING O+ECTI4ES
1.
1. 9n9ndedersrstatand !and !asisic accc accouountntining terg termiminonololog"g".. 2.
2. xxplplaiain n dodou!u!leleeentntr" r" ruruleles.s. 3.
3. IdIdenentiti-" -" ststepeps is in tn t$e a$e accccouountntining c"g c"clcle.e. 4.
4. RecorRecord trand transactsactions ions in 0ouin 0ournals= rnals= post post to lto ledger aedger accounccounts= ts= and prand prepare epare a tria trial !alal !alance.ance. 5.
5. xpxplailain t$e reasn t$e reasons -oons -or prepar preparinring ad0usg ad0ustinting entrg entries and idies and idententi-" mai-" ma0or t"0or t"pes o- ad0pes o- ad0ustustinging entries.
entries. '.
'. ,re,reparpare -ine -inancancial sial stattatemeements -nts -rom rom t$e at$e ad0ud0ustested trid trial !aal !alanlance.ce. .
. ,r,repeparare ce clolosising eng entntririeses.. +.
+. ,re,reparpare -ie -inannanciacial stl stateatemenments -ts -or a mor a mercerc$an$andisdising cing compompan"an".. 7.
71. Identi-" ad0usting entries t$at ma" !e reversed. 711. ,repare a 1column <or#s$eet.
SUMMARY OF 'EARNING O+ECTI4ES +Y 7UESTIONS
Item Type Item Type Item Type Item Type Item Type Item Type Item Type
'earnin. Ob8e#tive 9 1. TF 3. TF 21. :6 23. :6 25. :6 2. :6 123. 2. TF 4. TF 22. :6 24. :6 2'. :6 2+. :6 'earnin. Ob8e#tive 1 5. TF 2. :6 31. :6 33. :6 '. TF 3. :6 32. :6 34. :6 'earnin. Ob8e#tive 3 . TF 35. :6 3'. :6 3. :6 3+. :6 3. :6 'earnin. Ob8e#tive 5 +. TF 1. TF 4. :6 42. :6 44. :6 4'. :6 +. :6 . TF 25. :6 41. :6 43. :6 45. :6 +'. :6 'earnin. Ob8e#tive 6 11. TF 54. :6 '4. :6 4. :6 1. :6 11. :6 12. TF 55. :6 '5. :6 ++. :6 1+. :6 122. 13. TF 5'. :6 ''. :6 +. :6 1. :6 123. 4. :6 5. :6 '. :6 . :6 11. :6 124. 4+. :6 5+. :6 '+. :6 1. :6 111. :6 125. 4. :6 5. :6 '. :6 2. :6 112. :6 12'. 5. :6 '. :6 . :6 3. :6 113. :6 133. , 51. :6 '1. :6 1. :6 4. :6 114. :6 134. , 52. :6 '2. :6 2. :6 '. :6 115. :6 135. , 53. :6 '3. :6 3. :6 . :6 11'. :6 'earnin. Ob8e#tive : 14. TF 4. :6 12. 'earnin. Ob8e#tive ; 15. TF 1'. TF 5. :6 '. :6 +. :6 135. , 'earnin. Ob8e#tive < 1. TF 'earnin. Ob8e#tive => 1+. TF +. :6 12. :6 11. :6 12. 13'. , . :6 . :6 13. :6 12. :6 13. 13. , +. :6 1. :6 14. :6 121. :6 131. 13+. , . :6 11. :6 11+. :6 12+. 132. 'earnin. Ob8e#tive =9? 1. TF +2. :6 +4. :6 15. :6 1+. :6 12'. +1. :6 +3. :6 5. :6 1'. :6 1. :c 'earnin. Ob8e#tive =99 2. TF +5. :6 13. ,
'earnin. Ob8e#tive 91 @ IFRS 7uestions
+. * . *
Note> TF ? True@False ? xercise ? rie- xercise
:6 ? :ultiple 6$oice , ? ,ro!lem * ? *$ort ns<er
TRUE&FA'SE
1. ledger is <$ere a compan" -irst records transactions and ot$er selected events.
2. Nominal (temporar") accounts are revenue= expense= and dividend accounts and are periodicall" closed.
3. Real (permanent) accounts are revenue= expense= and dividend accounts and are periodicall" closed.
4. n example o- an internal event <ould !e a -lood t$at destro"ed a portion o- a compan"As inventor".
5. ll lia!ilit" accounts and stoc#$olders% e&uit" accounts are increased on t$e credit side and decreased on t$e de!it side.
'. In general= de!its re-er to increases in account !alances= and credits re-er to decreases. . T$e -irst step in t$e accounting c"cle is t$e 0ournali;ing o- transactions and selected
ot$er events.
+. Bne purpose o- a trial !alance is to prove t$at de!its and credits are e&ual in t$e general ledger.
. general 0ournal c$ronologicall" lists transactions and ot$er events= expressed in terms o- de!its and credits to accounts.
1. I- a compan" -ails to post one o- its 0ournal entries to its general ledger= t$e trial !alance <ill not s$o< an e&ual amount o- de!it and credit !alance accounts.
11. d0usting entries -or prepa"ments record t$e portion o- t$e prepa"ment t$at represents t$e expense incurred or t$e revenue recogni;ed in t$e current accounting period.
12. n ad0ustment -or <ages expense= earned !ut unpaid at "ear end= is an example o- an accrued expense.
13. T$e !oo# value o- an" deprecia!le asset is t$e di--erence !et<een its cost and its salvage value.
14. T$e ending retained earnings !alance is reported on !ot$ t$e retained earnings statement and t$e !alance s$eet.
15. T$e postclosing trial !alance consists o- asset= lia!ilit"= o<nersA e&uit"= revenue and expense accounts.
1'. It is not necessar" to post t$e closing entries to t$e ledger accounts !ecause ne< revenue and expense accounts <ill !e opened in t$e su!se&uent accounting period. 1. Total stoc#$olders% e&uit" consists o- common stoc# and t$e earnings retained in t$e
!usiness.
71+. T$e accrual!asis o- accounting recogni;es revenue <$en t$e per-ormance o!ligation is satis-ied and expenses <$en cas$ is paid.
71. Reversing entries are made at t$e end o- t$e accounting c"cle to correct errors in t$e original recording o- transactions.
72. n ad0usted trial !alance t$at s$o<s e&ual de!it and credit columnar totals proves t$e accurac" o- t$e ad0usting entries.
True & False Ans(ers * Con#e$tual
Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans%
1. F 5. F . T 13. F 1. T 2. T '. F 1. F 14. T 71+. F 3. F . F 11. T 15. F 71. F 4. F +. T 12. T 1'. F 72. F
MU'TIP'E CHOICE
*Con#e$tual
21. Factors t$at s$ape an accounting in-ormation s"stem include t$e a. nature o- t$e !usiness.
!. si;e o- t$e -irm.
c. volume o- data to !e $andled.
d. ll o- t$ese ans<er c$oices are correct.
22. T$e process o- trans-erring -igures -rom t$e !oo# o- original entr" to t$e ledger accounts is called
a. ad0usting. !. !alancing. c. ledgering. d. posting.
23. e!it al(as means
a. t$e rig$t side o- an account. !. an increase.
c. a decrease.
d. None o- t$ese ans<er c$oices are correct.
24. n accounting record into <$ic$ t$e essential -acts and -igures in connection <it$ all transactions are -irst recorded is called t$e
!. account. c. trial !alance.
25. trial !alance
a. proves t$at de!its and credits are e&ual in t$e ledger.
!. supplies a listing o- open accounts and t$eir !alances t$at are used in preparing -inancial statements.
c. is normall" prepared t$ree times in t$e accounting c"cle. d. ll o- t$ese ans<er c$oices are correct.
2'. C$ic$ o- t$e -ollo<ing is a real (permanent) accountD a. /ood<ill
!. *ervice Revenue c. ccounts Receiva!le
d. ot$ /ood<ill and ccounts Receiva!le
2. C$ic$ o- t$e -ollo<ing is a nominal (temporar") accountD a. 9nearned *ervice Revenue
!. *alaries and Cages xpense c. Inventor"
d. Retained arnings
2+. Nominal accounts are also called a. temporar" accounts.
!. permanent accounts. c. real accounts.
d. None o- t$ese ans<er c$oices are correct. 2. T$e dou!leentr" accounting s"stem means
a. ac$ transaction is recorded <it$ t<o 0ournal entries.
!. ac$ item is recorded in a 0ournal entr"= t$en in a general ledger account. c. T$e dual e--ect o- eac$ transaction is recorded <it$ a de!it and a credit. d. None o- t$ese ans<er c$oices are correct.
3. C$en a corporation pa"s a note pa"a!le and interest= a. t$e account notes pa"a!le <ill !e increased.
!. t$e account interest expense <ill !e decreased. c. t$e" <ill de!it notes pa"a!le and interest expense.
d. t$e" <ill de!it cas$.
31. *toc#$olders% e&uit" is not a--ected !" all a. cas$ receipts.
!. dividends. c. revenues. d. expenses.
32. T$e de!it and credit anal"sis o- a transaction normall" ta#es place a. !e-ore an entr" is recorded in a 0ournal.
!. <$en t$e entr" is posted to t$e ledger. c. <$en t$e trial !alance is prepared. d. at t$e end o- t$e accounting c"cle.
33. T$e accounting e&uation must remain in !alance a. t$roug$out eac$ step in t$e accounting c"cle. !. onl" <$en 0ournal entries are recorded.
c. onl" at t$e time t$e trial !alance is prepared.
d. onl" <$en -ormal -inancial statements are prepared.
34. T$e di--erence !et<een t$e accounting process and t$e accounting c"cle is
a. t$e accounting process results in t$e preparation o- -inancial statements= <$ereas t$e accounting c"cle is concerned <it$ recording !usiness transactions.
!. t$e accounting c"cle represents t$e steps ta#en to accomplis$ t$e accounting process.
c. t$e accounting process represents t$e steps ta#en to accomplis$ t$e accounting c"cle.
d. merel" semantic= !ecause !ot$ concepts re-er to t$e same t$ing. 35. n optional step in t$e accounting c"cle is t$e preparation o-
a. ad0usting entries. !. closing entries.
c. a statement o- cas$ -lo<s. d. a postclosing trial !alance.
3'. C$ic$ o- t$e -ollo<ing criteria must !e met !e-ore an event or item s$ould !e recorded -or accounting purposesD
a. T$e event or item can !e measured o!0ectivel" in -inancial terms. !. T$e event or item is relevant and relia!le.
c. T$e event or item is an element. d. ll o- t$ese must !e met.
3. C$ic$ o- t$e -ollo<ing is a recorda!le event or itemD a. 6$anges in managerial polic"
!. T$e value o- $uman resources c. 6$anges in personnel
d. None o- t$ese ans<er c$oices are correct. 3+. C$ic$ o- t$e -ollo<ing isnot an internal eventD
a. epreciation
!. 9sing ra< materials in t$e production process c. ividend declaration and su!se&uent pa"ment d. ll o- t$ese are internal transactions.
3. xternal events donot include
a. interaction !et<een an entit" and its environment.
!. a c$ange in t$e price o- a good or service t$at an entit" !u"s or sells. c. improvement in tec$nolog" !" a competitor.
d. using !uildings and mac$iner" in operations.
4. trial !alance ma" prove t$at de!its and credits are e&ual= !ut a. an amount could !e entered in t$e <rong account.
!. a transaction could $ave !een entered t<ice. c. a transaction could $ave !een omitted.
41. general 0ournal
a. c$ronologicall" lists transactions and ot$er events= expressed in terms o- de!its and credits.
!. contains one record -or eac$ o- t$e asset= lia!ilit"= stoc#$olders% e&uit"= revenue= and expense accounts.
c. lists all t$e increases and decreases in eac$ account in one place. d. contains onl" ad0usting entries.
42. 0ournal entr" to record t$e sale o- inventor" on account <ill include a a. de!it to Inventor".
!. de!it to ccounts Receiva!le. c. de!it to *ales Revenue.
d. credit to 6ost o- /oods *old.
43. 0ournal entr" to record a pa"ment on account <ill include a a. de!it to ccounts Receiva!le.
!. credit to ccounts Receiva!le. c. de!it to ccounts ,a"a!le. d. credit to ccounts ,a"a!le.
44. 0ournal entr" to record a receipt o- rent in advance <ill include a a. de!it to Rent Revenue.
!. credit to Rent Revenue. c. credit to 6as$.
d. credit to 9nearned Revenue.
45. C$ic$ o- t$e -ollo<ing errors <ill cause an im!alance in t$e trial !alanceD a. Bmission o- a transaction in t$e 0ournal.
!. ,osting an entire 0ournal entr" t<ice to t$e ledger.
c. ,osting a credit o- E2 to ccounts ,a"a!le as a credit o- E2 to ccounts Receiva!le.
d. isting t$e !alance o- an account <it$ a de!it !alance in t$e credit column o- t$e trial !alance.
*4'. C$ic$ o- t$e -ollo<ing is not a principal purpose o- an unad0usted trial !alanceD
a. It proves t$at de!its and credits o- e&ual amounts are in t$e ledger. !. It is t$e !asis -or an" ad0ustments to t$e account !alances.
c. It supplies a listing o- open accounts and t$eir !alances.
d. It proves t$at de!its and credits <ere properl" entered in t$e ledger accounts.
*4. n ad0usting entr" s$ould never include
a. a de!it to an expense account and a credit to a lia!ilit" account. !. a de!it to an expense account and a credit to a revenue account. c. a de!it to a lia!ilit" account and a credit to revenue account. d. a de!it to a revenue account and a credit to a lia!ilit" account. 4+. C$ic$ o- t$e -ollo<ing is an example o- an accrued expenseD
a. B--ice supplies purc$ased at t$e !eginning o- t$e "ear and de!ited to an expense account.
!. ,ropert" taxes incurred during t$e "ear= to !e paid in t$e -irst &uarter o- t$e su!se&uent "ear.
c. epreciation expense
,4. C$ic$ o- t$e -ollo<ing statements is true a!out t$e accrual !asis o- accountingD
a. T$e timing o- cas$ receipts and dis!ursements is emp$asi;ed.
!. minimal amount o- record #eeping is re&uired in accrual !asis accounting compared to cas$ !asis.
c. T$is met$od is used less -re&uentl" !" !usinesses t$an t$e cas$ met$od o- accounting.
d. Revenues are recogni;ed in t$e period t$e per-ormance o!ligation is satis-ied= regardless o- t$e time period t$e cas$ is received.
,5. n ad0usting entr" to record an accrued expense involves a de!it to a(an)
a. expense account and a credit to a prepaid account. !. expense account and a credit to 6as$.
c. expense account and a credit to a lia!ilit" account. d. lia!ilit" account and a credit to an expense account.
,51. T$e -ailure to properl" record an ad0usting entr" to accrue an expense <ill result in an
a. understatement o- expenses and an understatement o- lia!ilities. !. understatement o- expenses and an overstatement o- lia!ilities. c. understatement o- expenses and an overstatement o- assets. d. overstatement o- expenses and an understatement o- assets.
,52. C$ic$ o- t$e -ollo<ing properl" descri!es a de-erralD
a. 6as$ is received a-ter revenue is recogni;ed. !. 6as$ is received !e-ore revenue is recogni;ed. c. 6as$ is paid a-ter expense is incurred.
d. 6as$ is paid in t$e same time period t$at an expense is incurred.
,53. T$e -ailure to properl" record an ad0usting entr" to accrue a revenue item <ill result in an
a. understatement o- revenues and an understatement o- lia!ilities. !. overstatement o- revenues and an overstatement o- lia!ilities. c. overstatement o- revenues and an overstatement o- assets. d. understatement o- revenues and an understatement o- assets.
,54. T$e omission o- t$e ad0usting entr" to record depreciation expense <ill result in an
a. overstatement o- assets and an overstatement o- o<nersA e&uit". !. understatement o- assets and an understatement o- o<nerAs e&uit". c. overstatement o- assets and an overstatement o- lia!ilities.
d. overstatement o- lia!ilities and an understatement o- o<nersA e&uit". 55. d0ustments are o-ten prepared
a. a-ter t$e !alance s$eet date= !ut dated as o- t$e !alance s$eet date. !. a-ter t$e !alance s$eet date= and dated a-ter t$e !alance s$eet date. c. !e-ore t$e !alance s$eet date= and dated !e-ore t$e !alance s$eet date. d. !e-ore t$e !alance s$eet date= and dated a-ter t$e !alance s$eet date. 5'. t t$e time a compan" prepa"s a cost
a. it de!its an asset account to s$o< t$e service or !ene-it it <ill receive in t$e -uture. !. it de!its an expense account to matc$ t$e expense against revenues recogni;ed. c. its credits a lia!ilit" account to s$o< t$e o!ligation to pa" -or t$e service in t$e -uture. d. it credits an asset account and de!its an expense account.
5. o< do t$ese prepaid expenses expireD
Rent Supplies
a. Cit$ t$e passage o- time T$roug$ use and consumption !. Cit$ t$e passage o- time Cit$ t$e passage o- time
c. T$roug$ use and consumption T$roug$ use and consumption d. T$roug$ use and consumption Cit$ t$e passage o- time
5+. Recording t$e ad0usting entr" -or depreciation $as t$e same e--ect as recording t$e ad0usting entr" -or
a. an unearned revenue. !. a prepaid expense. c. an accrued revenue. d. an accrued expense.
5. 9nearned revenue on t$e !oo#s o- one compan" is li#el" to !e
a. a prepaid expense on t$e !oo#s o- t$e compan" t$at made t$e advance pa"ment. !. an unearned revenue on t$e !oo#s o- t$e compan" t$at made t$e advance pa"ment. c. an accrued expense on t$e !oo#s o- t$e compan" t$at made t$e advance pa"ment. d. an accrued revenue on t$e !oo#s o- t$e compan" t$at made t$e advance pa"ment. '. To compute interest expense on a note -or an ad0usting entr"= t$e -ormula is (principal G
annual rate G a -raction). T$e numerator and denominator o- t$e -raction are>
Numerator Denominator
a. engt$ o- time note $as !een outstanding 12 mont$s !. Total lengt$ o- note 12 mont$s
c. engt$ o- time until note matures Total lengt$ o- note d. engt$ o- time note $as !een outstanding Total lengt$ o- note '1. d0usting entries are necessar" to
1. o!tain a proper matc$ing o- revenue and expense. 2. ac$ieve an accurate statement o- assets and e&uities. 3. ad0ust assets and lia!ilities to t$eir -air mar#et value. a. 1
!. 2 c. 3
d. 1 and 2
'2. C$" are certain costs o- doing !usiness capitali;ed <$en incurred and t$en depreciated or amorti;ed over su!se&uent accounting c"clesD
a. To reduce t$e -ederal income tax lia!ilit" !. To aid management in cas$-lo< anal"sis
c. To matc$ t$e costs o- production <it$ revenues as recogni;ed d. To ad$ere to t$e accounting constraint o- conservatism
'3. C$en an expense is paid in cas$ !e-ore it is used= it is called a(n) a. prepaid expense.
!. accrued expense. c. estimated expense. d. cas$ expense.
'4. C$en revenue or expense $as !een recogni;ed or incurred !ut not "et collected or paid= it is normall" called a(n) HHHHHHHHHHHH revenue or expense.
a. de-erred !. ad0usted c. estimated
d. None o- t$ese ans<er c$oices are correct.
'5. C$en a revenue is collected and recorded in advance= it is normall" accounted -or as a(n) HHHHHHHHHHH revenue.
a. accrued !. prepaid c. unearned d. cas$
''. n accrued expense can !est !e descri!ed as an amount a. paid and currentl" matc$ed <it$ earnings.
!. paid and not currentl" matc$ed <it$ earnings. c. not paid and not currentl" matc$ed <it$ earnings. d. not paid and currentl" matc$ed <it$ earnings.
'. uring an accounting period= i- an expense $as !een incurred and consumed !ut not "et paid -or or recorded= t$en t$e endo-period ad0usting entr" <ould involve
a. a lia!ilit" account and an asset account.
!. an asset or contra asset account and an expense account. c. a lia!ilit" account and an expense account.
d. a receiva!le account and a revenue account.
'+. C$ic$ o- t$e -ollo<ing must !e considered in estimating depreciation on an asset -or an accounting periodD
a. T$e original cost o- t$e asset !. Its use-ul li-e
c. T$e decline o- its -air value
d. ot$ t$e original cost o- t$e asset and its use-ul li-e.
'. C$ic$ o- t$e -ollo<ing <ouldnot !e a correct -orm -or an ad0usting entr"D a. de!it to a revenue and a credit to a lia!ilit"
!. de!it to an expense and a credit to a lia!ilit" c. de!it to a lia!ilit" and a credit to a revenue d. de!it to an asset and a credit to a lia!ilit"
. earend net assets <ould !e overstated and current expenses <ould !e understated as a result o- -ailure to record <$ic$ o- t$e -ollo<ing ad0usting entriesD
a. xpiration o- prepaid insurance !. epreciation o- -ixed assets c. 9se o- supplies
d. ll o- t$ese ans<er c$oices are correct.
1. prepaid expense can !est !e descri!ed as an amount a. paid and currentl" matc$ed <it$ revenues.
!. paid and not currentl" matc$ed <it$ revenues. c. not paid and currentl" matc$ed <it$ revenues. d. not paid and not currentl" matc$ed <it$ revenues.
2. n accrued revenue can !est !e descri!ed as an amount a. collected and currentl" matc$ed <it$ expenses.
!. collected and not currentl" matc$ed <it$ expenses. c. not collected and currentl" matc$ed <it$ expenses. d. not collected and not currentl" matc$ed <it$ expenses. 3. n unearned revenue can !est !e descri!ed as an amount
a. collected and currentl" matc$ed <it$ expenses. !. collected and not currentl" matc$ed <it$ expenses. c. not collected and currentl" matc$ed <it$ expenses. d. not collected and not currentl" matc$ed <it$ expenses. 4. n ad0usted trial !alance
a. is prepared a-ter t$e -inancial statements are completed.
!. proves t$e e&ualit" o- t$e de!it !alances and credit !alances o- ledger accounts a-ter all ad0ustments $ave !een made.
c. is a re&uired -inancial statement under generall" accepted accounting principles. d. cannot !e used to prepare -inancial statements.
5. C$ic$ t"pe o- account is al<a"s de!ited during t$e closing processD a. ividends
!. xpense c. Revenue
d. Retained earnings
*'. C$ic$ o- t$e -ollo<ing statements !est descri!es t$e purpose o- closing entriesD
a. To -aciliate posting and ta#ing a trial !alance.
!. To determine t$e amount o- net income or net loss -or t$e -ollo<ing period.
c. To reduce t$e !alances o- revenue and expense accounts to ;ero so t$at t$e" ma" !e used to accumulate t$e revenues and expenses o- t$e next period.
d. To complete t$e record o- various transactions t$at <ere started in a prior period.
,. I- ending accounts receiva!le exceeds t$e !eginning accounts receiva!le
a. cas$ collections during t$e period exceed t$e amount o- revenue recogni;ed. !. net income -or t$e period is less t$an t$e amount o- cas$!asis income.
c. no cas$ <as collected during t$e period.
d. cas$ collections during t$e "ear are less t$an t$e amount o- revenue recogni;ed. 7+. 9nder t$e cas$!asis o- accounting= revenues are recorded
a. <$en t$e" are recogni;ed and reali;ed. !. <$en t$e" are recogni;ed and reali;a!le. c. <$en t$e" are recogni;ed.
d. <$en t$e" are reali;ed.
7. C$en converting -rom cas$!asis to accrual!asis accounting= <$ic$ o- t$e -ollo<ing ad0ustments s$ould !e made to cas$ receipts -rom customers to determine accrual!asis service revenueD
a. *u!tract ending accounts receiva!le.
!. *u!tract !eginning unearned service revenue. c. dd ending accounts receiva!le.
7+. C$en converting -rom cas$!asis to accrual!asis accounting= <$ic$ o- t$e -ollo<ing ad0ustments s$ould !e made to cas$ paid -or operating expenses to determine accrual !asis operating expensesD
a. dd !eginning accrued lia!ilities. !. *u!tract !eginning prepaid expense. c. *u!tract ending prepaid expense. d. *u!tract interest expense.
7+1. Reversing entries are
1. normall" prepared -or prepaid= accrued= and estimated items. 2. necessar" to ac$ieve a proper matc$ing o- revenue and expense.
3. use-ul in simpli-"ing t$e recording o- transactions in t$e next accounting period.
a. 1 !. 2 c. 3
d. 1 and 2
7+2. d0usting entries t$at s$ould !e reversed include t$ose -or prepaid or unearned items t$at a. create an asset or a lia!ilit" account.
!. <ere originall" entered in a revenue or expense account. c. <ere originall" entered in an asset or lia!ilit" account.
d. create an asset or a lia!ilit" account and <ere originall" entered in a revenue or expense account.
7+3. d0usting entries t$at s$ould !e reversed include a. all accrued revenues.
!. all accrued expenses.
c. t$ose t$at de!it an asset or credit a lia!ilit". d. ll o- t$ese ans<er c$oices are correct.
*7+4. reversing entr" s$ould never !e made -or an ad0usting entr" t$at
a. accrues unrecorded revenue.
!. ad0usts expired costs -rom an asset account to an expense account. c. accrues unrecorded expenses.
d. ad0usts unexpired costs -rom an expense account to an asset account.
*7+5. T$e <or#s$eet -or *$ar#o 6o. consisted o- -ive pairs o- de!it and credit columns. T$e
dollar amount o- one item appeared in !ot$ t$e credit column o- t$e income statement section and t$e de!it column o- t$e !alance s$eet section. T$at item is
a. net income -or t$e period. !. !eginning inventor". c. cost o- goods sold. d. net loss -or t$e period.
Multi$le Coi#e Ans(ers*Con#e$tual
Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans%
21. d 32. a 43. c 54. a '5. c '. c 22. d 33. a 44. d 55. a ''. d . d 23. d 34. ! 45. d 5'. a '. c 7+. d 24. d 35. d 4'. d 5. a '+. d 7. c 25. d 3'. d 4. ! 5+. ! '. d 7+. c 2'. d 3. d 4+. ! 5. a . d 7+1. c 2. ! 3+. c 4. d '. a 1. ! 7+2. d 2+. a 3. d 5. c '1. d 2. c 7+3. d 2. c 4. d 51. a '2. c 3. ! 7+4. ! 3. c 41. a 52. ! '3. a 4. ! 7+5. d 31. a 42. ! 53. d '4. d 5. c
*olutions to t$ose :ultiple 6$oice &uestions -or <$ic$ t$e ans<er is Jnone o- t$ese.K 23. le-t or le-tside.
24. 0ournal.
3. :an" ans<ers are possi!le. '4. accrued.
MU'TIP'E CHOICE
*Co-$utational
+'. :aso 6ompan" recorded 0ournal entries -or t$e issuance o- common stoc# -or E1'== t$e pa"ment o- E52= on accounts pa"a!le= and t$e pa"ment o- salaries expense o- E+4=. C$at net e--ect do t$ese entries $ave on o<ners% e&uit"D
a. Increase o- E1'=. !. Increase o- E1+=. c. Increase o- E'=. d. Increase o- E24=.
+. :une 6ompan" recorded 0ournal entries -or t$e declaration o- E15= o- dividends= t$e E'= increase in accounts receiva!le -or services rendered= and t$e purc$ase o- e&uipment -or E'3=. C$at net e--ect do t$ese entries $ave on o<ners% e&uit"D
a. ecrease o- E213=. !. ecrease o- E11=. c. ecrease o- E54=. d. Increase o- E33=.
++. ,app" 6orporation received cas$ o- E24= on *eptem!er 1= 214 -or one "ear%s rent in advance and recorded t$e transaction <it$ a credit to 9nearned Rent Revenue. T$e ecem!er 31= 214 ad0usting entr" is
a. de!it Rent Revenue and credit 9nearned Rent Revenue= E+=. !. de!it Rent Revenue and credit 9nearned Rent Revenue= E1'=. c. de!it 9nearned Rent Revenue and credit Rent Revenue= E+=. d. de!it 6as$ and credit 9nearned Rent Revenue= E1'=.
+. ,anda 6orporation paid cas$ o- E'= on 8une 1= 214 -or one "ear%s rent in advance and recorded t$e transaction <it$ a de!it to ,repaid Rent. T$e ecem!er 31= 214 ad0usting entr" is
a. de!it ,repaid Rent and credit Rent xpense= E25=. !. de!it ,repaid Rent and credit Rent xpense= E35=. c. de!it Rent xpense and credit ,repaid Rent= E35=. d. de!it ,repaid Rent and credit 6as$= E25=.
. Tate 6ompan" purc$ased e&uipment on Novem!er 1= 214 and gave a 3mont$= L note <it$ a -ace value o- E'=. T$e ecem!er 31= 214 ad0usting entr" is
a. de!it Interest xpense and credit Interest ,a"a!le= E5=4. !. de!it Interest xpense and credit Interest ,a"a!le= E1=35. c. de!it Interest xpense and credit 6as$= E.
d. de!it Interest xpense and credit Interest ,a"a!le= E.
1. ro<n 6ompan"As account !alances at ecem!er 31= 214 -or ccounts Receiva!le and t$e related llo<ance -or ou!t-ul ccounts are E2= de!it and E1=4 credit= respectivel". From an aging o- accounts receiva!le= it is estimated t$at E23= o- t$e ecem!er 31 receiva!les <ill !e uncollecti!le. T$e necessar" ad0usting entr" <ould include a credit to t$e allo<ance account -or
a. E23=. !. E24=4. c. E21='. d. E1=4.
2. 6$en 6ompan"As account !alances at ecem!er 31= 214 -or ccounts Receiva!le and t$e llo<ance -or ou!t-ul ccounts are E4+= de!it and E credit. *ales during 214 <ere E1='5=. It is estimated t$at 1L o- sales <ill !e uncollecti!le. T$e ad0usting entr" <ould include a credit to t$e allo<ance account -or
a. E1=4. !. E1'=5. c. E15='. d. E4=+.
3. *tarr 6orporation loaned E45= to anot$er corporation on ecem!er 1= 214 and received a 3mont$= +L interest!earing note <it$ a -ace value o- E45=. C$at ad0usting entr" s$ould *tarr ma#e on ecem!er 31= 214D
a. e!it Interest Receiva!le and credit Interest Revenue= E=. !. e!it 6as$ and credit Interest Revenue= E3=.
c. e!it Interest Receiva!le and credit Interest Revenue= E3=. d. e!it 6as$ and credit Interest Receiva!le= E=.
4. compan" receives interest on a E== +L= 5"ear note receiva!le eac$ pril 1. t ecem!er 31= 214= t$e -ollo<ing ad0usting entr" <as made to accrue interest receiva!le>
Interest Receiva!le ... 4=2
ssuming t$at t$e compan" does not use reversing entries= <$at entr" s$ould !e made on pril 1= 215 <$en t$e annual interest pa"ment is receivedD
a. 6as$ ... 1=4 Interest Revenue ... 1=4 !. 6as$ ... 4=2 Interest Receiva!le ... 4=2 c. 6as$ ... 5=' Interest Receiva!le ... 4=2 Interest Revenue ... 1=4 d. 6as$ ... 5=' Interest Revenue ... 5='
75. compan" receives interest on a E== +L= 5"ear note receiva!le eac$ pril 1. t ecem!er 31= 214= t$e -ollo<ing ad0usting entr" <as made to accrue interest receiva!le> Interest Receiva!le ... 4=2 Interest Revenue ... 4=2 ssuming t$at t$e compan" !oes use reversing entries= <$at entr" s$ould !e made on pril 1= 215 <$en t$e annual interest pa"ment is receivedD a. 6as$ ... 1=4 Interest Revenue ... 1=4 !. 6as$ ... 4=2 Interest Receiva!le ... 4=2 c. 6as$ ... 5=' Interest Receiva!le ... 4=2 Interest Revenue ... 1=4 d. 6as$ ... 5=' Interest Revenue... 5='
'. :urp$" 6ompan" su!let a portion o- its <are$ouse -or -ive "ears at an annual rental o- E'== !eginning on :a" 1= 214. T$e tenant= *$eri 6$arter= paid one "earAs rent in advance= <$ic$ :urp$" recorded as a credit to 9nearned Rent Revenue. :urp$" reports on a calendar"ear !asis. T$e ad0ustment on ecem!er 31= 214 -or :urp$" s$ould !e a. No entr" !. 9nearned Rent Revenue ... 2=
Rent Revenue ... 2=
c. Rent Revenue ... 2=
9nearned Rent Revenue ... 2=
d. 9nearned Rent Revenue ... 4=
Revenue Revenue... 4= . uring t$e -irst "ear o- Cil#inson 6o.As operations= all purc$ases <ere recorded as assets.
*upplies in t$e amount o- E25=+ <ere purc$ased. ctual "earend supplies amounted to E5='. T$e ad0usting entr" -or store supplies <ill
a. increase net income !" E2=2. !. increase expenses !" E2=2. c. decrease supplies !" E5='. d. de!it ccounts ,a"a!le -or E5='.
+. ig:out$ Frog 6orporation $ad revenues o- E3== expenses o- E2== and dividends o- E45=. C$en Income *ummar" is closed to Retained arnings= t$e amount o- t$e de!it or credit to Retained arnings is a
a. de!it o- E55=. !. de!it o- E1=. c. credit o- E55=. d. credit o- E1=.
7. T$e income statement o- olan 6orporation -or 214 included t$e -ollo<ing items> Interest revenue E121=
*alaries and <ages expense 1+= Insurance expense 1+=2
T$e -ollo<ing !alances $ave !een excerpted -rom olan 6orporationAs !alance s$eets> ecem!er 31= 214 ecem!er 31= 213 Interest receiva!le E1+=2 E15=
*alaries and <ages pa"a!le 1=+ +=4 ,repaid insurance 2=2 3= T$e cas$ received -or interest during 214 <as
a. E12=+. !. E11=+. c. E121=. d. E124=2.
71. T$e income statement o- olan 6orporation -or 214 included t$e -ollo<ing items> Interest revenue E121=
*alaries and <ages expense 1+= Insurance expense 1+=2
T$e -ollo<ing !alances $ave !een excerpted -rom olan 6orporationAs !alance s$eets> ecem!er 31= 214 ecem!er 31= 213 Interest receiva!le E1+=2 E15=
*alaries and <ages pa"a!le 1=+ +=4 ,repaid insurance 2=2 3= T$e cas$ paid -or salaries and <ages during 214 <as
a. E1+=4. !. E1='. c. E11='. d. E1=+.
711. T$e income statement o- olan 6orporation -or 214 included t$e -ollo<ing items> Interest revenue E121=
*alaries and <ages expense 1+= Insurance expense 1+=2
T$e -ollo<ing !alances $ave !een excerpted -rom olan 6orporationAs !alance s$eets> ecem!er 31= 214 ecem!er 31= 213 Interest receiva!le E1+=2 E15=
*alaries and <ages pa"a!le 1=+ +=4 ,repaid insurance 2=2 3= T$e cas$ paid -or insurance premiums during 214 <as
a. E1'=. !. E15=2. c. E1=. d. E1=4.
712. Blsen 6ompan" paid or collected during 214 t$e -ollo<ing items>
Insurance premiums paid E 25=+ Interest collected '2=+
*alariespaid 2'=4
T$e -ollo<ing !alances $ave !een excerpted -rom BlsenAs !alance s$eets>
ecem!er 31= 214 ecem!er 31= 213 ,repaid insurance E 2=4 E 3=
Interest receiva!le =4 5=+ *alaries and <ages pa"a!le 24=' 21=2 T$e insurance expense on t$e income statement -or 214 <as
a. E2=4. !. E25=2. c. E2'=4. d. E31=2.
713. Blsen 6ompan" paid or collected during 214 t$e -ollo<ing items>
Insurance premiums paid E 25=+ Interest collected '2=+
*alariespaid 2'=4
T$e -ollo<ing !alances $ave !een excerpted -rom BlsenAs !alance s$eets>
ecem!er 31= 214 ecem!er 31= 213 ,repaid insurance E 2=4 E 3=
Interest receiva!le =4 5=+ *alaries and <ages pa"a!le 24=' 21=2 T$e interest revenue on t$e income statement -or 214 <as
a. E4='. !. E'1=2. c. E'4=4. d. E'=.
714. Blsen 6ompan" paid or collected during 214 t$e -ollo<ing items>
Insurance premiums paid E 25=+ Interest collected '2=+ *alaries and <ages paid 2'=4 T$e -ollo<ing !alances $ave !een excerpted -rom BlsenAs !alance s$eets>
ecem!er 31= 214 ecem!er 31= 213 ,repaid insurance E 2=4 E 3=
Interest receiva!le =4 5=+ *alaries and <ages pa"a!le 24=' 21=2 *alaries and <ages expense on t$e income statement -or 214 <as
a. E214='. !. E25=. c. E2'3=+. d. E3'=2.
715. T$e *upplies account $ad a !alance at t$e !eginning o- "ear 3 o- E+= (!e-ore t$e reversing entr"). ,a"ments -or purc$ases o- supplies during "ear 3 amounted to E5= and <ere recorded as expense. p$"sical count at t$e end o- "ear 3 revealed supplies costing E11=5 <ere on $and. Reversing entries are used !" t$is compan". T$e re&uired ad0usting entr" at t$e end o- "ear 3 <ill include a de!it to>
a. *upplies xpense -or E3=5. !. *upplies -or E3=5.
c. *upplies xpense -or E4'=5. d. *upplies -or E11=5.
71'. t t$e end o- 214= re< 6ompan" made -our ad0usting entries -or t$e -ollo<ing items> 1. epreciation expense= E25=.
2. xpired insurance= E2=2 (originall" recorded as prepaid insurance.) 3. Interest pa"a!le= E'=.
4. Rent receiva!le= E1=.
In t$e normal situation= to -acilitate su!se&uent entries= t$e ad0usting entr" or entries t$at ma" !e reversed is (are)
a. ntr" No. 3 onl". !. ntr" No. 4 onl".
c. ntr" No. 3 and No. 4.
d. ntr" No. 2= No. 3 and No. 4.
71. /arcia 6orporation received cas$ o- E3'= on ugust 1= 214 -or one "earAs rent in advance and recorded t$e transaction <it$ a credit to Rent Revenue. T$e ecem!er 31= 214 ad0usting entr" is
a. de!it Rent Revenue and credit 9nearned Rent Revenue= E15=. !. de!it Rent Revenue and credit 9nearned Rent Revenue= E21=. c. de!it 9nearned Rent Revenue and credit Rent Revenue= E15=. d. de!it 6as$ and credit 9nearned Rent Revenue= E21=.
71+. ope; 6ompan" received E14=4 on pril 1= 214 -or one "earAs rent in advance and recorded t$e transaction <it$ a credit to a nominal account. T$e ecem!er 31= 214 ad0usting entr" is
a. de!it Rent Revenue and credit 9nearned Rent Revenue= E3='. !. de!it Rent Revenue and credit 9nearned Rent Revenue= E1=+. c. de!it 9nearned Rent Revenue and credit Rent Revenue= E3='. d. de!it 9nearned Rent Revenue and credit Rent Revenue= E1=+.
71. /i!son 6ompan" paid E12= on 8une 1= 214 -or a t<o"ear insurance polic" and recorded t$e entire amount as Insurance xpense. T$e ecem!er 31= 214 ad0usting entr" is
a. de!it Insurance xpense and credit ,repaid Insurance= E3=5. !. de!it Insurance xpense and credit ,repaid Insurance= E+=5. c. de!it ,repaid Insurance and credit Insurance xpense= E3=5 d. de!it ,repaid Insurance and credit Insurance xpense= E+=5. Multi$le Coi#e Ans(ers*Co-$utational
Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans Ite- Ans Ite- Ans%
+'. c . d 4. c +. d 712. c 71'. c +. c 1. c 5. d 7. ! 713. c 71. ! ++. c 2. ! '. d 71. ! 714. c 71+. a +. c 3. c . ! 711. d 715. d 71. d
MU'TIP'E CHOICE
*CPA A!a$te!
11. Bn *eptem!er 1= 214= o<e 6o. issued a note pa"a!le to National an# in t$e amount o- E== !earing interest at L= and pa"a!le in t$ree e&ual annual principal pa"ments o- E3=. Bn t$is date= t$e !an#As prime rate <as +L. T$e -irst pa"ment -or interest and principal <as made on *eptem!er 1= 215. t ecem!er 31= 215= o<e s$ould record accrued interest pa"a!le o-
a. E2=. !. E24=. c. E1+=. d. E1'=.
111. aton 6o. sells ma0or $ouse$old appliance service contracts -or cas$. T$e service contracts are -or a one"ear= t<o"ear= or t$ree"ear period. 6as$ receipts -rom contracts are credited to 9nearned *ervice Revenue. T$is account $ad a !alance o- E3=+= at ecem!er 31= 214 !e-ore "earend ad0ustment. *ervice contract costs are c$arged as incurred to t$e *ervice 6ontract xpense account= <$ic$ $ad a !alance o- E= at ecem!er 31= 214.
*ervice contracts still outstanding at ecem!er 31= 214 expire as -ollo<s> uring 215 E'=
uring 21' 1=14= uring 21 =
C$at amount s$ould !e reported as 9nearned *ervice Revenue in atonAs ecem!er 31= 214 !alance s$eetD a. E2==. !. E2=+=. c. E1==. d. E1==.
112. In Novem!er and ecem!er 214= ane 6o.= a ne<l" organi;ed maga;ine pu!lis$er= received E'= -or 1= t$ree"ear su!scriptions at E2 per "ear= starting <it$ t$e 8anuar" 215 issue. ane included t$e entire E'= in its 214 income tax return. C$at amount s$ould ane report in its 214 income statement -or su!scriptions revenueD
a. E. !. E3=333. c. E2=. d. E'=.
113. Bn 8une 1= 214= Nott 6orp. loaned orn E+= on a 12L note= pa"a!le in -ive annual installments o- E1'= !eginning 8anuar" 2= 215. In connection <it$ t$is loan= orn <as re&uired to deposit E5= in a noninterest!earing escro< account. T$e amount $eld in escro< is to !e returned to orn a-ter all principal and interest pa"ments $ave !een made. Interest on t$e note is pa"a!le on t$e -irst da" o- eac$ mont$ !eginning 8ul" 1= 214. orn made timel" pa"ments t$roug$ Novem!er 1= 214. Bn 8anuar" 2= 215= Nott received pa"ment o- t$e -irst principal installment plus all interest due. t ecem!er 31= 214= NottAs interest receiva!le on t$e loan to orn s$ould !e
a. E. !. E+=. c. E1'=. d. E24=.
114. Included in llen 6orp.As !alance s$eet at 8une 3= 213 is a 1L= E3== note pa"a!le. T$e note is dated Bcto!er 1= 213 and is pa"a!le in t$ree e&ual annual pa"ments o- E1=5= plus interest. T$e -irst interest and principal pa"ment <as made on Bcto!er 1= 214. In llenAs 8une 3= 215 !alance s$eet= <$at amount s$ould !e reported as accrued interest pa"a!le -or t$is noteD
a. E33=5. !. E225=. c. E112=5. d. E5=.
115. 6ola< 6o. pa"s all salaried emplo"ees on a !i<ee#l" !asis. Bvertime pa"= $o<ever= is paid in t$e next !i<ee#l" period. 6ola< accrues salaries expense onl" at its ecem!er 31 "ear end. ata relating to salaries earned in ecem!er 214 are as -ollo<s>
ast pa"roll <as paid on 12@2'@14= -or t$e 2<ee# period ended 12@2'@14. Bvertime pa" earned in t$e 2<ee# period ended 12@2'@14 <as E2=.
Remaining <or# da"s in 214 <ere ecem!er 2= 3= 31= on <$ic$ da"s t$ere <as no overtime.
ssuming a -iveda" <or#<ee#= 6ola< s$ould record a lia!ilit" at ecem!er 31= 214 -or accrued salaries o-
a. E1+=. !. E12+=. c. E21'=. d. E23'=.
11'. Tolan 6orp.As trademar# <as licensed to dd" 6o. -or ro"alties o- 15L o- sales o- t$e trademar#ed items. Ro"alties are pa"a!le semiannuall" on :arc$ 15 -or sales in 8ul" t$roug$ ecem!er o- t$e prior "ear= and on *eptem!er 15 -or sales in 8anuar" t$roug$ 8une o- t$e same "ear. Tolan received t$e -ollo<ing ro"alties -rom dd">
:arc$ 15 *eptem!er 15
213 E5= E=5
214 '= =5
dd" estimated t$at sales o- t$e trademar#ed items <ould total E3= -or 8ul" t$roug$ ecem!er 214. In TolanAs 214 income statement= t$e ro"alt" revenue s$ould !e
a. E14=. !. E15=5. c. E2=. d. E2=5.
11. t ecem!er 31= 214= *ue%s outi&ue $ad 1= gi-t certi-icates outstanding= <$ic$ $ad !een sold to customers during 214 -or E' eac$. *ue%s operates on a gross pro-it o- 'L o- its sales. C$at amount o- revenue pertaining to t$e 1= outstanding gi-t certi-icates s$ould !e de-erred at ecem!er 31= 214D
a. E.
!. E24=. c. E3'=. d. E'=.
711+. 6ompared to t$e accrual !asis o- accounting= t$e cas$ !asis o- accounting overstates income !" t$e net increase during t$e accounting period o- t$e
ccounts Receiva!le ccrued xpenses ,a"a!le
a. No No
!. No es
c. es No
d. es es
711. /regg 6orp. reported revenue o- E1=45= in its accrual !asis income statement -or t$e "ear ended 8une 3= 215. dditional in-ormation <as as -ollo<s>
ccounts receiva!le 8une 3= 214 E4= ccounts receiva!le 8une 3= 215 53= 9ncollecti!le accounts <ritten o-- during t$e -iscal "ear 15= 9nder t$e cas$ !asis= /regg s$ould report revenue o-
a. E1=35=. !. E1=5=. c. E1=35=. d. E1=335=.
712. 8im ount= :..= #eeps $is accounting records on t$e cas$ !asis. uring 215= r. ount collected E35= -rom $is patients. t ecem!er 31= 214= r. ount $ad accounts receiva!le o- E4=. t ecem!er 31= 215= r. ount $ad accounts receiva!le o- E= and unearned revenue o- E1=. Bn t$e accrual !asis= $o< muc$ <as r. ountAs patient service revenue -or 215D
a. E31=. !. E3=. c. E3+=. d. E3=.
7121. T$e -ollo<ing in-ormation is availa!le -or ce 6ompan" -or 214>
is!ursements -or purc$ases E1=3'= Increase in trade accounts pa"a!le 1= ecrease in merc$andise inventor" 4= 6ost o- goods sold -or 214 <as
a. E1=5=. !. E1=42=. c. E1=3=. d. E1=22=.
Multi$le Coi#e Ans(ers*CPA A!a$te!
Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans% Ite- Ans Ite- Ans%
11. c 112. a 114. ! 11'. a 711+. ! 712. ! 111. ! 113. c 115. ! 11. d 711. c 7121. a
)ERI4ATIONS
* Co-$utational
No% Ans(er )erivation
+'. c E1'= E+4= ? E'=. +. c E15= E'= ? E54=. ++. c E24= x 4@12 ? E+=.
+. c E'= x @12 ? E35=. . d 2@12 x L x E'= ? E. 1. c E23= M E1=4 ? E21='. 2. ! E1='5= x 1L ? E1'=5. 3. c 1@12 x +L x E45= ? E3=.
4. c E= x +L ? E5=' E5=' E4=2 ? E1=4 int. rev. 75. d E= x +L ? E5='
'. d E'= x +@12 ? E4=. . ! E25=+ M E5=' ? E2=2. +. d E3= E2= ? E1=.
7. ! E15= O E121= E1+=2 ? E11=+. 71. ! E+=4 O E1+= E1=+ ? E1='. 711. d E1+=2 M E3= O E2=2 ? E1=4. 712. c E25=+ O E' ? E2'=4.
713. c E'2=+ M E5=+ O E=4 ? E'4=4. 714. c E2'=4 M E21=2 O E24=' ? E2'3=+. 715. d E11=5 O E+= M E+= ? E11=5. 71'. c
71. ! @12 x E3'= ? E21=. 71+. a 3@12 x E14=4 ? E3='. 71. d 1@24 x E12= ? E+=5.
)ERI4ATIONS
* CPA A!a$te!
No% Ans(er )erivation
11. c (E= M E3=) G L G 4@12 ? E1+=. 111. ! E'= O E1=14= O E= ? E2=+=. 112. a E= none o- t$e E'= is recogni;ed.
113. c E+= G 12L G 2@12 ? E1'=. 114. ! E3== G @12 G 1L ? E225=. 115. ! E2= O (E3'= P 1 G 3) ? E12+=. 11'. a E=5 O (E3= G 15L) ? E14=. 11. d 1= G E' ? E'=.
711+. ! 6onceptual.
711. c E1=45= O E4= M E53= M E15= ? E1=35=. 712. ! E35= M E4= O E= M E1= ? E3=.
7121. a E1=3'= O E1= O E4= ? E1=5=.
+RIEF E2ERCISES
+E% 30911Qe-initions.
,rovide clear= concise ans<ers -or t$e -ollo<ing. 1. C$at is t$e accrual!asis o- accountingD 2. C$at is an accrued expenseD
3. C$at is accrued revenueD 4. C$at is a prepaid expenseD 5. C$at is unearned revenueD
7'. *tate t$e rule t$at indicates <$ic$ ad0usting entries -or prepaid and unearned items s$ould !e reversed.
Solution 30911
1. T$e accrual !asis o- accounting recogni;es revenue <$en t$e per-ormance o!ligation is satis-ied and recogni;es expenses in t$e period incurred.
2. n accrued expense is an expense <$ic$ is incurred !ut not paid in cas$ or recorded.
3. n accrued revenue is a revenue <$ic$ is recogni;ed !ut not "et received in cas$ or recorded.
4. prepaid expense is an expense paid in cas$ and recorded as an asset !e-ore it is used. 5. 9nearned revenues are t$e revenues received in cas$ and recorded as lia!ilities !e-ore t$e"
are recogni;ed.
7'. d0usting entries t$at create an asset or a lia!ilit" account s$ould !e reversed. T$is <ould include prepaid and unearned items originall" recorded in a revenue or expense account.
+E% 30913QTerminolog".
In t$e space provided at t$e rig$t= <rite t$e <ord or p$rase t$at is de-ined or indicated.
1. Revenue and expense accounts. 1. HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH 2. n optional step in t$e accounting 2. HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH
c"cle.
3. revenue collected= !ut not recogni;ed.3. HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH 4. revenue recogni;ed= !ut not collected.4. HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH 5. sset= lia!ilit"= and e&uit" accounts. 5. HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH '. n expense paid= !ut not incurred. '. HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH . n expense incurred= !ut not paid. . HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH
Solution 30913
1. Nominal (temporar") accounts. 5. Real (permanent) accounts. 2. Reversing entries. '. ,repaid expense.
3. 9nearned revenue. . ccrued expense. 4. ccrued revenue.
+E% 30915Qccrued items and de-erred (unearned or prepaid) items.
/enerall" accepted accounting principles re&uire t$e use o- accruals and de-errals in t$e determination o- income. o< is income determined under t$e accrual!asis o- accountingD Include in "our ans<er <$at constitutes an accrued item and a de-erred (prepaid) item= and give appropriate examples o- eac$.
Solution 30915
ccrual accounting recogni;es and reports t$e e--ects o- transactions and ot$er events in t$e time periods to <$ic$ t$e" relate rat$er t$an onl" <$en cas$ is received or paid. ccrual accounting attempts to matc$ revenues and t$e expenses associated <it$ t$ose revenues in order to determine net income -or an accounting period.
n accrued item is an item o- revenue or expense t$at $as !een recogni;ed or incurred during t$e period= !ut $as not "et !een collected or paid in cas$. n example o- an accrued revenue is rent -or t$e last mont$ o- an accounting period t$at $as !een recogni;ed !" a landlord !ut not "et paid !" t$e tenant. n example o- an accrued expense is salaries incurred -or t$e last <ee# o- an accounting period t$at are not pa"a!le until t$e su!se&uent accounting period.
de-erred (unearned or prepaid) item is an item o- revenue or expense t$at $as !een received or paid in cas$= !ut $as not "et !een recogni;ed or consumed. n example o- a de-erred revenue is unearned su!scription revenue collected in advance o- !eing recogni;ed. n example o- a
de-erred expense is an insurance premium paid at t$e end o- an accounting period <$ic$ <ill provide insurance coverage -or t$e -irst six mont$s o- t$e su!se&uent period.
E2ERCISES
EB% 30916Qd0usting entries.
,resent= in 0ournal -orm= t$e ad0ustments t$at <ould !e made on 8ul" 31= 215= t$e end o- t$e -iscal "ear= -or eac$ o- t$e -ollo<ing.
1. T$e supplies inventor" on ugust 1= 214 <as E=35. *upplies costing E22=15 <ere ac&uired during t$e "ear and c$arged to t$e supplies inventor". count on 8ul" 31= 215 indicated supplies on $and o- E+=+1.
2. Bn pril 3= a tenmont$= 'L note -or E3= <as received -rom a customer.
73. Bn :a" 1= E12= <as collected as rent -or one "ear and a nominal account <as credited.
Solution 30916 1. *upplies xpense ... 22=' *upplies ... 22=' 2. Interest Receiva!le ... 45 Interest Revenue ... 45 73. Rent Revenue ... =
