Adjusting Entries quiz

Financial Accounting Quiz

On Mar 9, 2026

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Adjusting Entries

10 questions in 10 minutes

Pass Score 70%

1 / 10

Each of the following is a major type (or category) of adjusting entries except :

recognized revenues

prepaid expenses

accrued expenses

accrued revenues

2 / 10

Which item is a constraint in fnancial accounting ?

Comparability

Materiality

Consistency

Cost

3 / 10

The principle or assumption dictating that efforts (expenses) be matched with accomplishments (revenues) is the :

time period assumption

revenue recognition principle

expense recognition principle

cost assumption

4 / 10

Adjustments for unearned revenues :

decrease revenues and decrease assets

have an assets and revenues account relationship

decrease liabilities and increase revenues

increase assets and increase revenues

5 / 10

Which of the following statements is incorrect concerning the adjusted trial balance ?

The adjusted trial balance lists the account balances segregated by assets and liabilities

The adjusted trial balance is prepared after the adjusting entries have been journalized and posted

An adjusted trial balance proves the equality of the total debit balances and the total credit balances in the ledger after all adjustments are made

The adjusted trial balance provides the primary basis for the preparation of financial statements

6 / 10

Which of the following statements about the accrual basis of accounting is false ?

This basis is in accord with generally accepted accounting principles

Events that change a company’s financial statements are recorded in the periods in which the events occur

Revenue is recorded only when cash is received,and expense is recorded only when cash is paid

Revenue is recognized in the period in which services are performed

7 / 10

Accumulated Depreciation is :

an expense account

an owner’s equity account

a contra asset account

a liability account

8 / 10

Adjusting entries are made to ensure that :

balance sheet and income statement accounts have correct balances at the end of an accounting period

revenues are recorded in the period in which services are performed

All the responses above are correct

expenses are recognized in the period in which they are incurred

9 / 10

The time period assumption states that :

the economic life of a business can be divided into artificial time periods

companies record information in the time period in which the events occur

companies use the fiscal year to report financial information

companies must wait until the calendar year is completed to prepare financial statements

10 / 10

The revenue recognition principle states that :

the fiscal year should correspond with the calendar year

the economic life of a business can be divided into artificial time periods

expenses should be matched with revenues

revenue should be recognized in the accounting period in which a performance obligation is satisfed

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Question topics

Adjusting Entries

the accrual basis of accounting

Adjusting entries for deferrals

Adjusting entries for accruals