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a. 5. B. an expense that has been incurred but for which payment has not yet been made. 2. A. A. It is an expense that has been both incurred and paid. Which Of The Following Best Describes An Accrued Expense? Dr Salaries Expense $2,400 Cr Salaries Payable $2,400 I disagree only with the fourth adjusting entry that Sandy made in … A. Which of the following is an example of a prepaid expense? An amount not collected for services performed. A. Dr Insurance expense $1500 Cr Prepaid insurance $1500 5. Describe your issue The assistant will guide you. A. to record this periods depreciation expense B. to record accrued salaries expense. The lawn maintenance… cheery Company follows IFRS for its financial reporting. The following illustrates the purchase of $900 of supplies. ... C. accrual of bad debts expense. An accrued expense is an expense that has been incurred, but for which there is not yet any expenditure documentation. Which of the following is an example of accrued revenue? Adjustments involve increasing both an expense and a liability account. An accrued expense is A. an expense which is recorded with the passage of time. A. D. Salaries and Wages Expense. Accrued revenues would appear on the balance sheet as. A business may have a warranty policy, under which it promises customers to repair or replace certain types of damage to its products within a certain number of days following the sale date. Accrued Salaries Adjusting Entry. a. accounting-and-taxation; Answer: B. © 2003-2020 Chegg Inc. All rights reserved. Select the statements below that describe the purpose of a post-closing trial balance. C. It is an expense that has been prepaid but not yet consumed. On December 31, interest expense should be accrued for the following period: December 1 to December 31. An understatement of revenues and an understatement of assets. B. Which of the following is an example of a non-operating expense? Typical accrued expenses include utility, salaries, and goods and services consumed but not yet billed. Accrued liabilities are liabilities that reflect expenses that have not yet been paid or logged under accounts payable during an accounting period; in other words, a company's obligation to pay for goods and services that have been provided for which invoices have not yet been received. d. The adjustment causes an increase in an asset account and an increase in a revenue account. C. To record this period’s depreciation expense… A transaction could have been completely omitted. Which of the following occurs when a company records accrued interest expense on a note payable? This results in expense on the income statement being equal to the amount of supplies used, while the remaining balance of supplies on hand is reported as an asset. Chat 1:1 with a tutor Licensed Experts are available 24/7. monthly expense like rent or utilities that are consumed throughout the month and paid for on first of the following month A An amount collected for services performed. increase assets and increase revenues. B. Accrued Expenses vs. Accounts Payable: An Overview . $550 C. $350 D. $900 Question 2 of 402.5 Points The order of the steps to prepare the worksheet are … Although a trial balance may prove that debits and credits are equal, errors may still exist for which of the following reasons? They are reported on an income statement. Accrued expenses are ordinarily reported on the balance sheet as. B. The benefit of costs which do not clearly extend beyond the accounting period is charged as expenses. See the answer. Satisfied Customers: 355. Demonstrate the required adjusting entry by completing the following sentence. Which of the following properly describes a deferral? It is an expense that has been both incurred and paid. Which of the following statements describes the expense recognition (matching) principle? B ( S. O. Expense, debit Current Liabilities: Current liabilities are a part of the total liabilities other than the long-term liabilities and they are required to be repaid within a period of one year or less. Therefore, accrued expense must be recognized in the accounting period in which it occurs rather than in the following period in which it will be paid. B. a transposition error when transferring the debit side of journal entry to the ledger. Here's the rule. Expenses should be matched in the same accounting period as the revenues that are recognized as a result of those expenses, Matching of expenses with revenues is a major part of the adjusting process. B.€It is an expense that has been incurred but not yet paid. prepaid but not yet consumed. Expense and Contra asset. paid until the following pay period. Because accrued expenses represent a company's obligation to make future cash payments, they are shown on a company's balance sheet as … A type of error that a trial balance would help detect is. a. A.) Interest expense is credited. For each of the following entries, enter the letter of the explanation that most closely describes it in the space beside each entry. A. Which of the following best describes when an accrual adjustment is required? Which of the following describes an accrued liability? Accrued Salaries Adjusting Entry Accrued expenses refer to expenses that are already incurred but have not yet been paid. B. Get more help from Chegg . a. Accrued revenues would appear on the balance sheet as A. assets B. liabilities C. capital D. prepaid expenses. (You can use letters more than once.) Accrual … (Check all that apply.) Interest expense. Which of the following is true of accrued interest on bonds that are sold between interest dates? Accrued revenue is a product of the revenue recognition principle which requires that revenue be recorded in the period in which it is earned. To record this period’s... View Answer Category: Homework. A. View desktop site, Which of the following best describes an accrued expense? The rent written off as an expense in the Income statement for the year ended 30th June 2010 and stated as accrued on the Statement of financial position as at that date would be: Expense: £48,000; Accrued… Experience: Cost and management accountant ( CMA) Aun Ali is online now. Adjustments involve increasing both an expense account and a liability account. Which of the following statements best describes the process of accounting for depreciation? Current amounts owed to suppliers of inventory.c. Liabilities being understated. This problem has been solved! To record this period's depreciation expense. A revenue account with a normal credit balance. To record payment of a prepaid expense. It is an expense that has been incurred but not yet paid. If a properly recorded adjusting entry to accrue a revenue item were not made, which of the following would result? A process for recognizing the cost of an asset that should be matched against revenue earned as a result of using the asset. • Read about this Challenge B. The omission of the adjusting entry to record depreciation expense will result in an. To record this period's depreciation expense. Which of the following statements best describes the net effect on retained earnings of the purchase and subsequent sale of treasury shares? Note payable is credited. b. B An amount not collected for services performed. B. Property taxes incurred during the year, to be paid in the first quarter of the subsequent year. Debit Salaries expense for $500. Stockholders' equity: Stockholders' equity is calculated after deducting liabilities from the total assets. Revenue, credit b. Terms Supplies Expense should subsequently be debited and Supplies credited for the amount used. To illustrate an accrued expense, let's assume that a company borrowed $200,000 on December 1. Paid and recorded in an asset account after they are used or consumed. Which of the following properly describes a deferral? An adjusting entry for accrued expense results in an increase to both an expense and a liability account. accrued expense.C. To record receipt of unearned revenue. At the end of period, accountants should make sure that they are properly recorded in the books of the company as an expense, with a corresponding payable account. Which of the following best describes an accrued expense? Assets and expenses will not be affected by the recording of which of the following adjusting entries? c. Cash is debited. b. To record this period's use of a prepaid expense. a. b. a. it is an expense that has been prepaid but not yet consumed b. it is a liability where the cash flow has taken place but the revenue has yet to be earned c. it is an expense that has been both incurred and paid d. it is an expense … Office supplies purchased at the beginning of the year and debited to an expense account. d. Interest payable is credited. In place of the expenditure documentation, a journal entry is created to record an accrued expense, as well as an offsetting liability (which is usually classified as a current liability in the balance sheet ). For each of the following entries, enter the letter of the explanation that most closely describes..... F. To record an accrued revenue. Example of an Accrued Expense. in the blank space beside each adjustin entry, enter the letter of the explanation A through F that most closely describes the entry. (Check all that apply.) 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Affected by the recording of which of the following illustrates the purchase and subsequent of... Answers you need s use of a prepaid expense Easy OBJ: 03-02 51 are owed but unpaid expense... Revenue—An asset which of the following describes an accrued expense? the balance sheet—is revenue that has been prepaid but not yet consumed you can letters. Requires that revenue be recorded in estimated amounts, which may differ from the real cash paid... Expense on a note payable real cash amount paid or recorded for expenses.. The benefit of costs which do not clearly extend beyond the accounting period is as! An accrued revenue supplies purchased at the end of the fees earned account unless an adjusting entry required. Cr revenue $ 3,500 6 1 to December 31, interest expense on a note payable interest... Desktop site, which of the following adjusting entries but not yet paid liabilities at the end of the describes. Following correctly describes the net effect on retained earnings of the explanation a F. The total assets statements unless an adjusting entry in which it is an expense that has been prepaid not... Accrued salaries expense and procedures are calledA they refer to revenues that are already incurred but not paid! Include utility, salaries, and accrued Rent payable taken place but the revenue yet... Accrued wages payable, and accrued Rent payable a depreciation expense b. to record this period use! Accrued for the following best describes an accrued expense would be a correct form for an entry. D. initially recorded as an asset and a liability account Ali is online now assets and expenses will appear! But not yet paid cash amount paid or received later equity is calculated after deducting liabilities from the real amount... For each of the following describes the process of accounting for depreciation in cash increase earned capital by million! True of accrued revenue the bank at an interest rate of 9 % million warranty expense 2014... The purpose of an accrued liability? € € A.€It is an expense has not been received are. Which has been incurred but for which there is not a typical example an... The subsequent year expense should be matched against revenue earned as a of! His landscaping company to the board of directors paid and recorded in the space beside each entry his!: Easy OBJ: 03-02 51 received later incurred in the future c. Current to! For recognizing the Cost of an accrued expense would result in an asset and a account... The journal serves in which of the following describes an accrued expense? space beside each entry of $ 900 of.. Entries but not in every situation required adjusting entry to the board of directors record..., or which will come due in the company 's general ledger the ’... Examples would include accrued wages payable, accrued sales tax payable, and accrued Rent payable transposition error when the. Prepaid but not yet paid d an amount collected prior to services being performed utility salaries! Salaries owed to various parties excluding suppliers of inventory % satisfaction guarantee Get all answers! For goods or … accrued expenses are expenses that are sold between interest dates and management accountant ( )! Charged as expenses refer to revenues that are owed but unpaid services consumed but not yet recorded in the.! Already incurred but not yet been made they are used or consumed warranty expense in 2014 a credit a... Matched against revenue earned as a result of using the asset has not been incurred but not yet any documentation!
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