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AIPB EXAM 1 2025|ACTUAL EXAM WITH 180
QUESTIONS AND ANSWERS|ALREADY GRADED A+
A chart of accounts lists accounts in the following order... a. income, expense, asset, liability and owners' equity accounts. b. asset, income, expense, liability and owners' equity accounts. c. asset, income, owners' equity, expense and liability accounts. d. asset, liability, owners' equity, income and expense accounts. d On which of the following accounts do we normally not record depreciation? a. Inventory b. Equipment c. Furniture d. Building a Interest earned on a money market account and credited to your company's bank account but not recorded on your books.... a. is recorded on your books with a normal transaction entry. b. is recorded on your books with an adjusting entry.
c. is recorded on your books with both a transaction entry and an adjusting entry. d. requires no entry in your books. a or b Which of the following dates is appropriate for a profit and loss statement? a. as of June 30, 20XX b. June 30, 20XX c. for the Quarter Ended June 30, 20XX d. All of the above are appropriate c Total debits must equal total credits. This is the basis of... a. an income statement b. an earnings statement c. a profit and loss statement d. double-entry bookkeeping d Which of the following accounts might be included in an adjusting entry? a. Cash
a. received b. earned c. incurred d. paid d Your company gets $5,000 in December to paint a house. The work is done in January. How much revenue is reported on a cash basis in December and January, respectively? a. $2,500 and $2, b. $5,000 and $ c. $0 and $5, d. $2,000 and $3, b You receive $80,000 before you do work for a customer. The journal entry to record this transaction is... a. debit Cash $80,000, credit Unearned Revenue $80,000. To record cash received. b. debit Cash $80,000, credit Accounts Receivable $80,000. To record cash received. c. debit Cash $80,000, credit Accounts Payable $80,000. To record cash received.
d. debit Unearned Revenue $80,000, credit Cash $80,000. To record cash received. a When are adjusting entries prepared? a. beginning of the accounting period b. end of the accounting period c. middle of the accounting period d. time of the transaction b Your company holds a 90-day note receivable of $10,000 from a customer. The note is dated October 31 and has a 12% interest rate. Your company's year ends on December 31. How much interest revenue do you accrue on December 31? a. $1, b. $ c. $ d. $ c The journal entry to accrue interest revenue is...
Which of the following is an accurate description of accrued revenue? a. It is unearned. b. It has been received in cash. c. It is earned and received in cash. d. It has not yet been received in cash. d The balance in Allowance For Doubtful Accounts is important to the calculation of bad debt when bad debt is calculated... a. as a percentage of credit sales b. as a percentage of accounts receivable that will not be collected. c. under the direct write off method. d. none of the above b A company with a 5-day workweek pays employees on Friday. Its accounting period ends on Thursday. Gross salary for the week is $10,000. How much salary expense is accrued at the year end? a. $10, b. $8,
c. $2, d. $ b Which of the following journal entries accrues interest expense? a. debit Interest Expense, credit Interest Payable. To accrue interest expense. b. debit Interest Payable, credit Interest Expense. To accrue interest expense. c. debit Interest Expense, credit Cash. To accrue interest expense. d. debit Cash, credit Interest Expense. To accrue interest expense. a A firm with a 6day workweek pays employees on Saturday. If the firm's year ends on a Saturday, gross salary for that week is $12,000, how much salary expense is accrued at year end? a. $12, b. $8, c. $6, d. $ d
Your company pays expenses of $50,000 during year and accrues expenses of $5,000 at year end? What are your company's total expenses for the year? a. $55, b. $50, c. $45, d. $5, a Rehabilitation Inc. uses accrual basis of accounting. It collects $10,000 in December for painting job and credits revenue. By the end of December, its year end, the company has completed 30% of the job. How much cash did Rehabilitation Inc. collect in December? a. $10, b. $7, c. $3, d. $ a Rehabilitation Inc. uses accrual basis of accounting. It collects $10,000 in December for painting job and credits revenue. By the end of December, its year end, the company has completed 30% of the job. How much revenue has Rehabilitation, Inc. earned in December? a. $10, b. $7,
c. $3, d. $ c Rehabilitation Inc. uses accrual basis of accounting. It collects $10,000 in December for painting job and credits revenue. By the end of December, its year end, the company has completed 30% of the job. The adjusting journal entry on December 31 (omitting dollars) is... a. debit Unearned Revenue, credit Cash. To reflect unearned revenue. b. debit Unearned Revenue, credit Revenue. To reflect unearned revenue. c. debit Revenue, credit Unearned Revenue. To reflect unearned revenue. d. debit Cash, credit Revenue. To reflect unearned revenue. c Unearned revenue is also known as... a. deferred expense b. deferred revenue c. earned revenue d. cash paid b
When revenue is credited, it increases revenue. a. True b. False a Unearned Revenue is what type of account? a. asset b. liability c. revenue d. expense b We have an expert-written solution to this problem! In accrual basis accounting, "recognized" would mean... a. paid b. received c. incurred d. recorded c
With prepaid supplies, cash payment follows recording of the expense. a. True b. False b DEF Co. uses accrual basis accounting. It pays $15,000 to cover a 3-year insurance premium and debits "insurance expense." One (1) year has elapsed. How much insurance expense has DEF Co. incurred this year? a. $15, b. $10, c. $5, d. $ c DEF Co. uses accrual basis accounting. It pays $15,000 to cover a 3-year insurance premium and debits "insurance expense." One (1) year has elapsed. How much has DEF Co paid for insurance this year? a. $15, b. $10, c. $5, d. $
Your company buys office supplies and debits Supplies On Hand for $10,000. At year end, you estimate that you used $4,000 of these supplies. What is the expense for supplies used? a. $10, b. $6, c. $4, d. $ c Generally, an adjusting journal entry... a. is used in both accrual basis and cash basis accounting. b. affects both the income statement and the balance sheet. c. affects only the income statement d. affects only the balance sheet b Your company, which uses accrual basis accounting, pays $18,000 in advance to cover a 3 year insurance premium and debits Prepaid Insurance. How much insurance expense has your company incurred after 1 year has elapsed? a. $18, b. $12, c. $6, d. $
c Your company shows the following data at the end of its first year: Credit sales for the year $1,000, Accounts Receivable balance $100, Allowance for Doubtful Accounts $4,000 credit balance If bad debt is estimated as 1% of credit sales, the adjusting entry for bad debt expense includes a debit for.. a. $14, b. $10, c. $6, d. $ b If your company estimates that it will not collect 5% of its accounts receivable, the year-end adjustment to Allowance for Doubtful Accounts will be... a. a credit of $1, b. a credit of $5, c. a debit of $1, d. a debit of $5, b
c. when you have earned the revenue and received the payment d. when you have earned the revenue and receive b Under accrual basis accounting, you recognize an expense when you have... a. paid the expense b. incurred the expense and paid for it c. recorded payment of the expense on your books d. incurred the expense d Under accrual basis accounting, revenues presented on the income statement are... a. revenues earned during the year b. revenues earned for the year in cash c. cash received form customers during the year d. revenues earned during the year for which invoices have been sent to customers a We have an expert-written solution to this problem!
Under accrual basis accounting, expenses presented on the income statement are... a. expenses incurred during the year b. expenses paid during the year c. expenses incurred during the year that have been paid d. payment to vendors for expenses incurred through December 31 a To accrue revenue at year end is to record... a. receipt of payment from a customer b. the amount of an invoice sent to a customer c. an amount earned for which payment has not been received d. an amount earned and deposited in your bank c To defer revenue is to... a. postpone recording a customer's payment as revenue until it is earned b. postpone depositing a cash payment in the bank c. postpone accepting payment from a customer until you do the work d. postpone depositing a customer's payment to minimize current year income taxes a
