Chapter 3

seven-fold Choice Questions (10 points each(prenominal)) Select the ONE, BEST Answer 1. Adjusting entries A. Affect only income line of reasoning accounts. B. Affect only remainder sheet accounts. C. Affect both income literary argument and balance sheet accounts. D. Affect only cash flow report accounts. E. Affect only equity accounts. 2. An adjusting entry could be made for each of the following except A. Prepaid expenses. B. Depreciation. C. Owner withdrawals. D.Unearned revenues. E. Accrued revenues. 3. Accrued revenues A. At the end of matchless invoice period often result in cash pass ons from customers in the next period. B. At the end of one accounting period often result in cash payments in the next period. C. Are also called unearned revenues. D. Are listed on the balance sheet as liabilities. E. Are recorded at the end of an accounting period because cash has already been received for revenues earned. 4.On May 1, 2007 Giltus Advertising telephoner received $1, fiv e hundred from Julie Bee for advertising services to be completed April 30, 2008. The Cash receipt was recorded as unearned fees and at December 31, 2007, $1,000 of the fees had been earned. The adjusting entry on December 31 course of study 1 should include A. A calculate to Unearned Fees for $500. B. A credit to Unearned Fees for $500. C. A credit to realize Fees for $1,000. D. A debit to Earned Fees for $1,000. E. A debit to Earned Fees for $500. line of work (60 points) SHOW ALL WORKA company has 20 employees who each earn $500 per week for a 5-day week that begins on Monday. December 31 of Year 1 is a Monday, and all 20 employees worked that day. (a) Prepare the required adjusting daybook entry to record accrued salaries on December 31, 2004. (b) Prepare the diary entry to record the payment of salaries on January 4, 2005. Dec. 31st, 2004DrCr Salaries expense$2,000 Salaries payable$2,000 Jan. 4, 2005 DrCr net expense$8,000 Salary payable$2,000 Cash Paid$10,000Chapter 3