Chapter 3

eightfold Choice Questions (10 points each) Select the ONE, BEST Answer 1. Adjusting entries A. touch on only income statement accounts. B. Affect only sleep sheet accounts. C. Affect both income statement and respite sheet accounts. D. Affect only cash be given statement accounts. E. Affect only equity accounts. 2. An adjusting opening could be made for each of the following pretermit A. Prepaid expenses. B. Depreciation. C. Owner withdrawals. D.Unearned revenues. E. Accrued revenues. 3. Accrued revenues A. At the end of one story system period oftentimes result in cash receipts 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 preserve at the end of an accounting period because cash has already been received for revenues earned. 4.On whitethorn 1, 2007 Giltus Advertising Company received $1,500 from Juli e Bee for advertising function to be completed April 30, 2008. The Cash receipt was scaned as unearned fees and at December 31, 2007, $1,000 of the fees had been earned. The adjusting gateway on December 31 Year 1 should include A. A debit entry 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. Problem (60 points) SHOW ALL WORKA union has 20 employees who each earn $500 per workweek 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 ledger entry to record accrued salaries on December 31, 2004. (b) Prepare the journal entry to record the payment of salaries on January 4, 2005. Dec. 31st, 2004DrCr Salaries expense$2,000 Salaries collectible$2,000 Jan. 4, 2005 DrCr Salary expense$8,000 Salary payable$2,000 Cash Paid$10,000Chapter 3