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Kaplan University AC 499 Quiz 3 (Graded)

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Question;Grade Details - All Questions 1. Question: Stan received $12,000 from a tenant on December 1 for four months' rent of an office. This rent was for December, January, February, and March. If Stan debited Cash and credited Unearned Rental Income for $12,000 on December 1, what necessary adjustment would be made on December 31? Student Answer: Unearned Rental Income............. 3,000 Rental Income.................... 3,000 Rental Income...................... 3,000 Unearned Rental Income........... 3,000 Unearned Rental Income............. 9,000 Rental Income.................... 9,000 Rental Income...................... 9,000 Unearned Rental Income........... 9,000 2. Question: Kite Company paid $24,900 in insurance premiums during 2013. Kite showed $3,600 in prepaid insurance on its December 31, 2013, balance sheet and $4,500 on December 31, 2012. The insurance expense on the income statement for 2013 was Student Answer: $16,800. $24,000. $25,800. $33,000. 3. Question: An accrued expense can be described as an amount Student Answer: paid and matched with earnings for the current period. paid and not matched with earnings for the current period. not paid and not matched with earnings for the current period. not paid and matched with earnings for the current period. 4. Question: Failure to record the expired amount of prepaid rent expense would not Student Answer: understate expense. overstate net income. overstate owners' equity. understate liabilities. 5. Question: On June 30, a company paid $3,600 for insurance premiums for the current year and debited the amount to Prepaid Insurance. At December 31, the bookkeeper forgot to record the amount expired. The omission has the following effect on the financial statements prepared December 31: Student Answer: overstates owners' equity. overstates assets. understates net income. overstates both owners? equity and assets. 6. Question: A company sold 10,000 shares of its own $1 par value common stock for $60,000. The entry to record the sale would include a Student Answer: debit to treasury stock for $60,000. debit to contributed capital for $10,000. credit to common stock, $1 par value for $10,000. credit to common stock, $1 par value for $60,000. 7. Question: How would proceeds received in advance from the sale of nonrefundable tickets for the Super Bowl be reported in the seller?s financial statements published before the Super Bowl? Student Answer: Revenue for the entire proceeds. Revenue less related costs. Unearned revenue less related costs. Unearned revenue for the entire proceeds. 8. Question: An adjusting entry will not take the format of which one of the following entries? Student Answer: A debit to an expense account and a credit to an asset account A debit to an expense account and a credit to a revenue account A debit to an asset account and a credit to a revenue account A debit to a liability account and a credit to a revenue account 9. Question: If an expense has been incurred but not yet recorded, then the end-of-period adjusting entry would involve Student Answer: a liability account and an asset account. a liability account and a revenue account. a liability and an expense account. a receivable account and a revenue account. 10. Question: Sky Company collected $12,350 in interest during 2013. Sky showed $1,850 in interest receivable on its December 31, 2013, balance sheet and $5,300 on December 31, 2012. The interest revenue on the income statement for 2013 was Student Answer: $3,450. $8,900. $12,350. $14,200.

 

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