CHAPTER 4: ADJUSTMENTS

Question 1

postponemnet of the recognition of an expense alreadypaidfor but not yet incurred or revenue already collected but not yet eraned

Answer 1

deferral

Question 2

effect of deferrals on balance shee and income statement

Answer 2

decreases balance sheet, increases incme statement

Question 3

recognition of an expense already incurred but unpaid or revenue earned but uncollected

Answer 3

accrual

Question 4

effect of accrual on IS and BS

Answer 4

increases both balance sheet and income statement

Question 5

expense for prepaid

Answer 5

expired porton

Question 6

asset for prepaid

Answer 6

unexpired portion

Question 7

simple lists assets followed by liabilities and owners equity in vertical sequence

Answer 7

report form

Question 8

lists assets on the letf then liabilities and owners equity on the right

Answer 8

account frm

Question 9

clsoing entries for service

Answer 9

revenue / income summary
income summary / expenses
income summary / capital
withdrawal / capital

Question 10

journal entry which is the exact opposite of a related adjusting entry made at the end of the period

Answer 10

reversing entries

Question 11

a reversing entry should be made for any adjusting entry thta

Answer 11

increased an asset or liability account

Question 12

what type of adjusting entry is reversed

Answer 12

accruals