All of the adhering to statements about vertical evaluation are true exceptA. Vertical evaluation may be ready for several durations to analyze alters in relationships over timeB. Major differences between a company"s vertical analysis and market averages should be investigatedC. In a vertical analysis of an revenue statement, every item is declared as a percent of full expensesD. In a vertical evaluation of a balance sheet, every asset article is declared as a percent of complete assets
At the end of the fiscal year, the normal adjusting entry come prepaid insurance money to document expired insurance was omitted. I m sorry of the following statements is true?A. Net income for the year will be overstated.B. Full assets at the end of the year will be understated.C. Stockholders" equity at the finish of the year will be understated.D. Insurance expense will it is in overstated.
You are watching: Which of the following statements is true about vertical analysis?
The balance in the prepaid rental account before adjustment at the finish of the year is $32,000, which represents 4 months" rent payment on December 1. The adjusting entry forced on December 31 isA. Debit rent Expense, $8,000; credit transaction Prepaid Rent, $8,000B. Debit Prepaid Rent, $24,000; credit transaction Rent Expense, $8,000C. Debit Prepaid Rent, $8,000; credit Rent Expense, $8,000D. Debit rental Expense, $24,000; credit Prepaid Rent, $8,000
The form of account and normal balance that Prepaid insurance money isA. Asset, debitB. Asset, creditC. Contra asset, creditD. Contra asset, debit
Which that the adhering to is taken into consideration to be an accrued expense?A. A computer technician has been payment in breakthrough to install software program updates together they end up being availableB. A computer technician has actually just signed an commitment with you concerning pricing for future workC. A computer technician has actually installed the latest software updates, however you have not received an invoice or make paymentD. A computer system technician has actually installed the latest software updates and was paid on the very same day
When is the readjusted trial balance prepared?A. Prior to the adjusting newspaper entries space journalizedB. After adjusting newspaper entries space postedC. ~ the adjusting journal entries are journalizedD. Before adjusting newspaper entries space posted
Prepaid advertising, representing payment because that the next quarter, would be reported on the balance sheet as a(n)A. LiabilityB. Stockholders" equityC. Contra assetD. Asset
Which of the following accounts would most likely be had in a deferral adjusting entry?A. Interest RevenueB. Salaries PayableC. Unearned RevenueD. Account Receivable
The difference between the balance the a resolved asset account and also the related accumulated depreciation account is termedA. Contra assetB. Market valueC. Publication valueD. Historic cost
The adjusting entrance to document the depreciation the a structure for the fiscal period isA. Debit Building; credit Depreciation Expense.B. Debit gathered Depreciation; credit transaction Depreciation Expense.C. Debit Depreciation Expense; credit Building.D. Debit Depreciation Expense; credit built up Depreciation.
The revenue recognition principleA. Says that revenue is not taped until the cash is receivedB. Determines as soon as revenue is attributed to a revenue accountC. Is no in conflict with the cash method of accountingD. Controls every revenue reporting for the cash basis of accounting
The adjusting entry to readjust supplies to be omitted at the end of the year. This would influence the earnings statement by havingA. Prices understated and also therefore net earnings overstatedB. Prices understated and therefore net income understatedC. Earnings understated and also therefore net earnings understatedD. Costs overstated and therefore net earnings understated
Which of the audit steps in the accounting procedure below would be perfect last?A. PostingB. Preparing the financial statementsC. JournalizingD. Prepare the changed trial balance
The equivalent principleA. Addresses the relationship in between the journal and also the balance sheetB. Claims that the revenues and related costs should be reported in the very same periodC. Determines even if it is the normal balance of an account is a debit or creditD. Requires that the dollar lot of debits same the dollar quantity of credits ~ above a trial balance
Accumulated Depreciation and also Depreciation price are classified, respectively, asA. Revenue, assetB. Asset, contra liabilityC. Contra asset, expenseD. Expense, contra asset
The entry to readjust the account for wages accrued at the finish of the accounting duration isA. Debit incomes Payable; credit wages ExpenseB. Debit incomes Payable; credit CashC. Debit incomes Expense; credit wages PayableD. Debit Cash; credit incomes Payable
Prior come the adjusting process, accrued costs haveA. To be paid but have no yet to be incurredB. No yet been incurred, paid, or recordedC. Been incurred, no paid, however have been recordedD. Been incurred, not paid, and also not recorded
Accrued earnings would appear on the balance paper asA. Usual stockB. AssetsC. LiabilitiesD. Prepaid expenses
Accrued expenses are ordinarily report on the balance sheet asA. LiabilitiesB. Fixed assetsC. Prepaid expensesD. Assets
If the adjustment because that depreciation is not recordeda. Net revenue is overstated.b. Net income is correctly stated.c. Assets space understated.d. Revenues are overstated.
The adjusting entrance to document depreciation includesa. A debit come an price account.b. A debit come an heritage account.c. A debit come a legal responsibility account.d. No one of these selections are correct.
Unearned revenuesa. Are videotaped as assets as soon as cash is received.b. Space recorded as soon as services have actually been performed because that the customer.c. Are referred to as future revenues.d. Every one of these selections are correct.
Once the readjusted trial balance is balanced, it can be offered to preparea. The share balance sheet.b. The earnings statement, the retained earnings statement, and the classified balance sheet.c. The divide balance sheet and also the income statement.d. None of these financial statement selections are ready with the changed trial balance.
Revenue is recorded once services have been carry out or assets have been delivered to customers. The accountancy principle supporting this report isa. The earnings statement principle.b. The cash basis principle.c. The revenue recognition principle.d. The adjusting principle.
Adjusting entries room dateda. At the end of the accountancy period.b. Once cash is received.c. As soon as an financial event occurs.d. In ~ the start of the audit period.
Because collecting the convey data requires time, the adjusting entries are oftena. Gone into later but dated together of the last day of the period.b. Estimated and also recorded previously than the critical day of the period.c. Omitted.d. Entered and also dated later than the last day that the period.
The changed trial balance is prepareda. Come verify the equality of total debit and also credit balances.b. To determine the net earnings or loss.c. To identify whether the balance sheet is in balance.d. For all of these reasons.
The readjusted trial balance is prepareda. To verify the equality of total debit and credit balances.b. To recognize the net earnings or loss.c. To identify whether the balance sheet is in balance.d. For all of these reasons.
Vertical evaluation can be supplied to analysis changesa. Top top a balance sheet.b. Over time.c. ~ above an earnings statement.d. All of these options are correct.
If the adjustment for unearned revenues is no recordeda. Assets will certainly be overstated.b. Liabilities will certainly be understated.c. Net revenue will it is in understated.d. Net earnings will be appropriately stated.
Which that the complying with represents a deferral?a. Built up depreciationb. Salaries payablec. Prepaid insuranced. Fees earned
The unearned subscriptions account reflected a balance of $32,500 prior to any kind of adjustments. That is determined that $9,800 in subscriptions remain unearned at the finish of the period. The adjusting journal entry should include aa. Credit transaction to Subscriptions Revenue because that $22,700.b. Credit to Unearned Subscriptions because that $22,700.c. Credit transaction to Subscriptions Earned for $9,800.d. Debit come Unearned Subscriptions because that $9,800.
See more: The Primary Focus For Financial Accounting Information Is To Provide Information Useful For
GreenSource agency began the duration with $330 in supplies. Throughout the month, second $1,500 of supplies were purchased. A physical inventory at the finish of the period revealed the there were $585 of offers on hand. The adjusting entrance should incorporate aa. Debit to provides for $585.b. Credit transaction to Supplies price for $1,245.c. Credit transaction to gives for $1,245.d. Credit to Supplies price for $585.