Reference no: EM132542726

Questions -

Q1 - On July 1, Dexter Store paid $8,000 to ACE Company for 4 months rent beginning July 1. Prepaid Rent was debited for the full amount. If financial statements are prepared on July 31, the adjusting entry to be made by Dexter Store is:

Debit Rent Expense, $8,000; Credit Prepaid Rent, $2,000

Debit Rent Expense, $2,000; Credit Prepaid Rent, $2,000

Debit Rent Expense, $8,000; Credit Prepaid Rent, $8,000

None of the above

Q2 - A gift shop signs a three-month note payable. The note is signed on November 1 in the amount of $50,000 with annual interest of 12%. What is the adjusting entry to be made on December 31 for the interest expense accrued to that date?

Q3 - At December 31, 2019, before any year-end adjustments, Karr Company's Insurance Expense account had a balance of $1,450 and its Prepaid Insurance account had a balance of $3,800. It was determined that $3,000 of the Prepaid Insurance had expired. The adjusted balance for Insurance Expense for the year would be:

$3,000

$1,450

$4,450

$800

Q4 - A Company purchased a computer system for $3,600 on October 1, 2019. The company expects to use the computer system for 3 years. It has no salvage value. The depreciation expense of the year 2019 on the asset is:

$100

$300

$1,200

$3,600

Q5 - A Company purchased an 18-month insurance policy on May 31, 2019 for $3,600. The December 31, 2019 balance sheet would report Prepaid Insurance of:

$0 because Prepaid Insurance is reported on the Income Statement

$1,400

$2,200

$3,600

Q6 - A Company collected $8,400 in October 1 of 2018 for 4 months of service which would take place from October of 2018 through January of 2019. The revenue reported from this transaction at the end of 2018 adjusting entry would be:

0

$6,300

$8,400

$2,100