Adjusting Entries #2 Quick Test

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Note: Some of the following test questions may not have been covered in the Explanation or Practice Quiz for this topic. For more insight regarding a specific question, use the search box at the top of the page.

1. The amount of supplies used during the current accounting period should be reported as Supplies __________.
2. __________ __________ Expense or Uncollectible Accounts Expense is associated with Accounts Receivable and the Allowance for Doubtful Accounts.
3. Depreciation Expense is associated with the contra-asset account __________ Depreciation.
4. Insurance Expense is associated with the asset account__________ Insurance.
5. The amount of insurance premiums which expired in the current accounting period is reported in the account __________ __________.
6. The amount of insurance premiums that have not yet expired is reported as an __________.
7. Adjusting entries are likely to affect one balance sheet account and one __________ __________ account.
8. At the beginning of the year, the asset Supplies had a balance of $1,000. At the end of the year, it had a balance of $1,300. During the year the company purchased $3,000 of supplies, which were recorded in the Supplies account. The amount of Supplies Expense during the year was $__________.
9. An accrued expense is one where the amount has already been paid.
10. Deferred revenues are those where the money has already been received.
Use the following information for answering Questions 11 and 12:
On August 1, a company obtained its first insurance policy covering its property. The policy is for one year and it begins immediately on August 1. The insurance premium for this 12-month period is $2,400 and it was paid on August 1.
11. The amount to be reported as Prepaid Insurance on December 31 is $__________.
12. The amount to be reported as Insurance Expense for the accounting year ending on December 31 is $__________.
Use the following information for answering Questions 13 - 18:
On December 21, a company borrowed $100,000 from its bank. The loan has an annual interest rate of 10%. The first payment on the loan will be due on January 21. The company's accounting year ends on December 31.
13. The December 31 adjusting entry will include a debit to Interest __________.
14. The December 31 adjusting entry will include a credit to Interest__________.
15. The amount of the December 31 adjusting entry is $__________. (Round to the nearest dollar.)
16. If the December 31 adjusting entry is not made, the company’s net income will be too __________.
17. If the December 31 adjusting entry is not made, the amount of the company’s liabilities reported on the balance sheet will be __________.
18. The type of adjusting entry in Question 13 through 15 is __________ __________.
Use the following information for answering Questions 19 - 22:
On November 28, an attorney received $3,000 as an advance payment for legal work to be performed. On November 28, the $3,000 was recorded with a debit to Cash and a credit to Unearned Fees.

As of November 30, the attorney did not provide any legal services for the client. During December the attorney provided $1,900 of services. As of December 31 no entry had been made to Fees Earned.
19. Will an adjusting entry be needed at November 30?
20. The adjusting entry at December 31 will involve a debit to the account __________ __________.
21. The adjusting entry at December 31 will involve a credit to the account __________ __________.
22. The amount to be used in the December 31 adjusting entry is $__________.
23. Adjusting entries are recorded in the __________ journal.
24. A prepayment is associated with this type of adjusting entry.
25. Reversing entries are usually associated with these adjusting entries.
26. Adjusting entries are usually dated as of the __________ day of the accounting period.
27. When wages are paid to employees based on the previous week’s hours worked, an accrual-type adjusting entry is likely to be needed for the monthly financial statements.
Use the following information for answering Questions 28 - 30:
On December 1 a company paid its insurance premium of $3,000. The amount covers the six month period of December 1 through May 31. The bookkeeper debited Insurance Expense for the full amount. The company's accounting year ends on December 31.
28. Before the December 31 financial statements are issued, the account __________ __________ needs to be debited.
29. The account to be credited is __________ __________.
30. The amount of the adjusting entry will be $__________.

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Adjusting Entries(Quick Test #2)

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