Chapter 4 Quiz
1) At the beginning of the year, Henry Corp. purchased $5,000 of supplies. It made a
journal entry debiting supplies for $5,000 and crediting Cash for $5,000. At the end
of the year it has $1,000 of supplies left. It did not purchase any other supplies
during the year. The appropriate adjusting journal entry is
a) Debit supplies expense $4,000 and credit Supplies $4,000
b) Debit supplies $4,000 and credit supplies expense $4,000
c) Debit supplies $1000 and credit supplies expense $1,000
d) Debit supplies expense $1,000 and credit supplies $1,000
2)Accumulated Depreciation:
a) appears on the balance sheet in the stockholders’ equity section
b) appears on the income statement as an expense
c) appears on the balance sheet as a liability account
d) appears on the balance sheet as a contra asset account
3) On March 1, Bylo Co. moved some cash into a certificate of deposit at a bank. The
CD is for 3 months and will earn $150 during the period. What is the adjusting
journal entry that is required as of March 31
a) Debit Cash $50 and credit Interest Revenue $50
b) Debit Interest Receivable $50 and credit Interest Revenue $50
c) Debit Interest Receivable for $150 and credit Interest Revenue $150
d) No journal entry is needed at this time
4)Fenworth Corp. pays income tax at an average rate of 30 percent. This year its
revenue is $100,000 and its expenses are $70,000. The effect of paying income tax is
to:
a) Decrease net income by $30,000
b) Increase Stockholders’ equity by $9,000
c) Decrease stockholders equity by $9,000
d) Increase liabilities by $9,000
5)Which of the following appear on an adjusted trial balance
a) Ending Retained Earnings
b) Dividends Declared
c) Gross profit
d) Net Income
6) Yulan, Inc has beginning Retained Earnings of $22,000, ending Retained Earnings
of $32,000 and net income of $15,000. How much dividends did it pay during the
year.
a) $5,000
b)$7,000
c) $10,000
d) $15,000
7) Which of the following is not true regarding an adjusted trial balance?
a) It is prepared at the beginning of the year
b) It is used to prepare financial statements
c) It is prepared to ensure that total debits equals total credits
d) It is prepared after the adjusting journal entries have been made
8) Which of the following will appear on the post-closing trial balance?
a) dividends declared
b) accumulated depreciation
c) wages expense
d) sales revenue
9) Antel is a tenet of Baber. On July 1, Antel paid Baber $1200 for 3 months of
rent. On July 31 Antel’s adjusting entries will include:
a) A debit to rent expense for $1200 and a credit to prepaid rent for $1200
b) A debit to prepaid rent for $1200 and a credit to cash for $1200
c) A debit to rent expense for $400 and a credit to prepaid rent for $400
d) A debit to prepaid rent for $400 and a credit to Rent expense for $400
10) Antel is a tenet of Baber. On July 1, Antel paid Baber $1200 for 3 months of
rent. On July 31 Baber’s adjusting entries will include:
a) a debit to Unearned Rent Revenue for $1200 and a credit to Rent
Revenue for $1200
b) a debit to Cash for $1200 and a credit to Unearned Rent Revenue for
$1200
c) a debit to Unearned Rent Revenue for $400 and a credit to Rent
Revenue for $400
d) a debit to Rent Expense for $400 and a credit to Prepaid Rent for $400