Ch. 4 SI Worksheet1. Which of the following statements regarding the need for adjustments is not correct?A. Expenses should be recorded in the same period as the revenues to which they relate.B. Assets should be reported at amounts representing the economic benefits that remain at the end of the current period (the matching principle).C. Revenues should be recorded in the same period as the cash is received (the revenue principle).D. All of the above are reasons for recording adjustments.2. All of the following are accounts that would typically be included in deferral adjustments except:A. Unearned RevenueB. Supplies ExpenseC. Accumulated DepreciationD. Accounts Receivable3. All of the following are accounts that would typically be included in accrual adjustments expect:A. Interest ReceivableB. Wages PayableC. Income tax expenseD. Prepaid Rent4. The records of Greene Enterprises include the following as of June 1, 2010. The Property and Equipment has a balance of $600,000 and the Accumulated Depreciation account has a balance of $133,000. Depreciation for the month of June 2010 has been estimated at $12,500. What will the balance in the Accumulated Depreciation account be after the related adjustment is recorded on June 30, 2010?A. $120,500B. $145,500C. $587,500D. $612,5005. Which of the following statements regarding the adjusting journal entry for equipment is not correct?A. The amount of depreciation expense for the period depends on the method used to calculate it.B. Accumulated depreciation is reported on the income statement while Depreciation Expense is reported on the balance sheet.C. By recording depreciation in Accumulated Depreciation separate from the Equipment account, you can report both the original cost of equipment and a running total of the amount that has been depreciated.D. A contra-account is an account that is an offset to, or a reduction of, another account.For each of the following situations show the effects of the adjustment on the accounting equation, along with the required adjusting journal entryExample:a. Of $700 of supplies that were received in August, $400 remains on hand at September 30. Assets = Liabilities + SESupplies – 300 Supplies Expense -300Supplies Expense $300Supplies $300b. Three months of rent were prepaid on September 1 for $7,200, but one month has now expired, leaving two months prepaid at September 30.c. Twelve months of insurance were prepaid on September 1 for $3600, but one month has now expired, leaving only eleven months prepaid at September 30.d. The salon equipment, which was estimated to last five years, has now been used for one month, representing an estimated expense of $1,000e. Supercuts redeemed $175 of gift cards that customers used to pay for haircutsf. Supercuts, provided $40 of haircut services to a the salon manager on the last day of September, with payment to be received in October.g. Supercuts owes $900 of wages to stylists for work done in the last three days of Septemberh. Supercuts as not paid or recorded the $100 interest that it owes for this month on its note payable to the
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