ACC 291T Week 4 Practice: Connect® Knowledge Check (2019 New)

Complete the Week 4 Knowledge Check in Connect®.

Note: You have unlimited attempts available to complete this practice assignment. The highest scored attempt will be recorded.

These assignments have earlier due dates, so plan accordingly.

Grades must be transferred manually to eCampus by your instructor. Don't worry, this might happen after your due date.

Rose Bush Nursery purchased a delivery truck for $40,000. The truck is expected to have a useful life of 5 years and a residual value of $2,800. The company uses the straight-line method of depreciation. If the truck was purchased on June 1, 2019, what is the amount of depreciation expense for the truck for the year ended December 31, 2019?

Multiple Choice

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$2,800

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$3,100

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$7,440

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$4,340

The ending merchandise inventory is recorded on the worksheet in the

Multiple Choice

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Income Statement Debit column only.

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Income Statement Credit column only.

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Income Statement Credit and the Balance Sheet Debit columns.

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Balance Sheet Debit column only.

After both of the entries for the inventory adjustment have been posted, the debit in the Income Summary account represents:

Multiple Choice

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Beginning Inventory

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Net Income

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Ending Inventory

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Cost of Goods Sold

An adjusting entry is usually not required for a revenue item when it is

Multiple Choice

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earned, recorded and paid for by the customer in one period.

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paid for by the customer and recorded in one period but not fully earned until a later period.

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earned in one period but not paid for by the customer or recorded until a later period.

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budgeted, paid for, and partially earned in one period but not fully earned until a later period.

On December 1, 2019, a firm accepted a 6-month, 12 percent note for $10,000 from a customer. The adjusting entry on December 31 to record the interest earned on the note is:

Multiple Choice

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a debit to Interest Receivable for $600 and a credit to Interest Income for $600.

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a debit to Interest Income for $100 and a credit to Interest Receivable for $100.

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a debit to Interest Receivable for $1,200 and a credit to Interest Income for $1,200.

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a debit to Interest Receivable for $100 and a credit to Interest Income for $100.

Which of the following statements is ?

Multiple Choice

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On the worksheet, the amount of the ending merchandise inventory is shown in the Income Statement Credit column in the account Income Summary and the Balance Sheet Debit column in the account Merchandise Inventory.

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All of these statements are .

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On the worksheet, the totals of the Income Statement columns should equal the totals of the Balance Sheet columns.

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On the worksheet, if debits exceed credits in the Adjusted Trial Balance section, the difference represents a net loss.

Allowance for Doubtful Accounts is reported in the

Multiple Choice

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Assets section of the balance sheet.

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Liabilities section of the balance sheet.

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Cost of Goods Sold section of the income statement.

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Operating Expenses section of the income statement.

During the year, Spirit Fun had net credit sales of $800,000. Past experience shows that 1.5 percent of the firm's net credit sales will be uncollectible. Determine the adjusting entry needed to recognize the estimated expense for these uncollectible accounts.

Multiple Choice

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debit Allowance for Doubtful Accounts $12,000 and credit Accounts Receivable $12,000.

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debit Uncollectible Accounts Expense $12,000 and credit Allowance for Doubtful Accounts $12,000.

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debit Uncollectible Accounts Expense $12,000 and credit Accounts Receivable $12,000.

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debit Uncollectible Accounts Expense $120,000 and credit Allowance for Doubtful Accounts $120,000.

On January 2, 2019, a firm purchased equipment for $10,000. Depreciation expense for the year ending December 31, 2019, given the straight-line method, a 5-year useful life, and a salvage value of $1,200, is

Multiple Choice

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$1,760.

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$2,000.

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$1,800.

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$1,400.

Millie's Bakery employees earn $4,500 a week for a five-day work week and are paid every Friday. If December 31 falls on a Wednesday, calculate the amount that is owed and select the adjusting entry needed to record the owed but unpaid salaries as of December 31.

Multiple Choice

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a debit to Salaries Expense for $4,500 and a credit to Salaries Payable for $4,500.

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a debit to Salaries Expense for $2,700 and a credit to Salaries Payable for $2,700.

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a debit to Income Summary for $2,700 and a credit to Salaries Payable for $2,700.

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a debit to Salaries Payable for $900 and a credit to Salaries Expense for $900.

If an account has a credit balance of $2,200 in the Trial Balance section of a worksheet and there is a credit of $400 in the Adjustments section, the account balance in the Adjusted Trial Balance section of the worksheet is

Multiple Choice

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$2,600 credit.

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$1,800 debit.

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$2,600 debit.

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$1,800 credit.

The trial balance of Marley Motorcycles shows Merchandise Inventory of $80,000. Based on a count taken on December 31, merchandise inventory at the end of the year actually totaled $92,000. The company uses a periodic inventory system. The adjusting entry to record the new merchandise inventory balance would be:

Multiple Choice

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a debit to Merchandise Inventory of 80,000 and a credit to Income Summary for $80,000.

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a debit to Purchases of $92,000 and a credit to Income Summary for $92,000.

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a debit to Merchandise Inventory of $92,000 and a credit to Income Summary for $92,000.

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a debit to Merchandise Inventory of $12,000 and a credit to Purchases for $12,000.

Identify the statement below that is true regarding the Allowance for Doubtful Accounts account.

Multiple Choice

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The account has a normal debit balance and is reported on the balance sheet.

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The account has a normal credit balance and is reported on the balance sheet.

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The account has a normal debit balance and is reported on the income statement.

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The account has a normal credit balance and is reported on the income statement.

Which of the following statements is not ?

Multiple Choice

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If a firm records prepaid expense items in an expense account when they pay for them, their adjustment at the end of the period to record the unexpired portion would include a debit to an asset account and a credit to an expense account.

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Each adjustment for an accrued expense includes a credit to a liability account.

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The cost less the salvage value equals the depreciable base of a long-term asset.

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Uncollectible Accounts Expense is a contra asset account.

With the accrual basis of accounting, revenue from a credit sale is recognized

Multiple Choice

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each time a payment on an account balance is received.

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on the date the account is collected in full.

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on the date of the sale.

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either on the date of the sale or when the amount of the sale is collected.

The net income for an accounting period can be determined using the worksheet by comparing the balances and determining the difference between the balances in the two

Multiple Choice

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Balance Sheet and Income Statement Debit columns.

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Balance Sheet and Income Statement Credit columns.

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Income Statement or Balance Sheet columns.

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Income Statement columns only.

Stan Still Stationery Store's employees are paid every Friday for a five day work week and are paid a total of $1,625 per day. If December 31, 2019, is on a Tuesday, the amount of the adjusting entry for accrued wages is:

Multiple Choice

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$4,875

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$3,250

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$8,125

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$1,625

Allowance for Doubtful Accounts is

Multiple Choice

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added to Accounts Receivable in the Assets section of the balance sheet.

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listed in the Operating Expenses section of the income statement.

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deducted from Sales in the Revenue section of the income statement.

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subtracted from Accounts Receivable in the Asset section of the balance sheet.

Accrued income is income that has been

Multiple Choice

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earned and received.

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budgeted for the fiscal period.

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received but not earned.

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earned but not received.

If an account has a debit balance of $2,000 in the Trial Balance section of a worksheet and there is a credit of $600 in the Adjustments section, the account balance in the Adjusted Trial Balance section of the worksheet is a

Multiple Choice

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$1,400 debit.

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$1,400 credit.

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$600 credit.

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$2,600 debit.

The net income for an accounting period appears on the worksheet in the

Multiple Choice

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Income Statement Credit column only.

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Income Statement Debit column only.

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Income Statement Debit and the Balance Sheet Credit columns.

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Income Statement Credit and the Balance Sheet Debit columns.

On April 1, 2019, a firm accepted a 6-month, 10 percent note for $1,800 from a customer with an overdue balance. The accrued interest recorded for this note for the year ended June 30, 2019, is

Multiple Choice

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$15.

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$90.

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$180.

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$45.

On June 1, 2019, Mighty Fast Flooring issued a 10-month, 9 percent note for $5,000. The note was recorded in the Notes Payable-Trade account. The adjusting entry on December 31 to record the interest accrued (owed) on the note is:

Multiple Choice

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a debit to Interest Expense for $262.50 and a credit to Interest Payable for $262.50.

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a debit to Interest Expense for $262.50 and a credit to Notes Payable-Trade for $262.50.

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a debit to Interest Income for $450.00 and a credit to Interest Receivable for $450.00.

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a debit to Interest Expense for $450.00 and a credit to Interest Payable for $450.00.

After the two adjusting entries for merchandise inventory for Marley Motorcycles have been entered on the worksheet, the Income Summary account in the Adjusted Trial Balance section has a debit of $65,000 and a credit of $73,000. The amount of merchandise inventory at the beginning of the year is:

Multiple Choice

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$138,000.

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$8,000.

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$73,000.

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$65,000.

The trial balance of Premier Lighting Co. shows Merchandise Inventory of $35,000. Based on a count taken on December 31, merchandise inventory at the end of the year actually totaled $28,000. The adjusting entry torecord the new merchandise inventory balance assuming the company uses the periodic inventory system would be:

Multiple Choice

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a debit to Purchases of $35,000 and a credit to Merchandise Inventory for $35,000.

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a debit to Merchandise Inventory of $28,000 and a credit to Income Summary for $28,000.

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a debit to Income Summary of $28,000 and a credit to Merchandise Inventory for $28,000.

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a debit to Income Summary of 35,000 and a credit to Merchandise Inventory for $35,000.

The trial balance of Premier Lighting Co. shows Merchandise Inventory of $35,000. The company uses the periodic inventory system. Based on a count taken on December 31, merchandise inventory at the end of the year actually totaled $28,000. The adjusting entry to remove the old merchandise inventory balance would be:

Multiple Choice

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a debit to Income Summary of $35,000 and a credit to Merchandise Inventory for $35,000.

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a debit to Merchandise Inventory of $28,000 and a credit to Income Summary for $28,000.

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a debit to Income Summary of $28,000 and a credit to Merchandise Inventory for $28,000.

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a debit to Purchases of $35,000 and a credit to Merchandise Inventory for $35,000.

On August 1, 2019, a firm purchased a 1-year insurance policy for $3,600 and paid the full premium in advance. The insurance expense associated with this policy for the year ending December 31, 2019, is

Multiple Choice

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$300.

•  

$3,600.

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$1,800.

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$1,500.

On October 1, 2019, Paige Turner Publishing received $5,400 in cash for subscriptions covering one year, recording the entry as a debit to Cash and a credit to Unearned Subscriptions. The  adjusting entry at December 31, 2019, is

Multiple Choice

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Debit Unearned Subscriptions $5,400; credit Subscriptions Income $5,400.

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Debit Unearned Subscriptions $450; credit Subscriptions Income $450.

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Debit Unearned Subscriptions $1,350; credit Subscriptions Income $1,350.

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Debit Subscriptions Income $1,350; credit Unearned Subscriptions $1,350.

On June 1, 2019, a firm purchased a 1-year insurance policy for $2,400 and paid the full premium in advance. The insurance expense associated with this policy for the year ending December 31, 2019, is

Multiple Choice

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$2,400.

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$1,000.

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$200.

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$1,400.

Hugh Morris Company pays weekly wages of $15,000 every Friday for a five day week ending on that day. If the last day of the year is on Tuesday, the adjusting entry to record the accrued wages is:

Multiple Choice

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debit Wages Expense $6,000; credit Drawing $6,000

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debit Wages Expense $6,000; credit Wages Payable $6,000

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debit Wages Expense $15,000; credit Cash $15,000

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debit Wages Expense $9,000; credit Wages Payable $9,000