Reference no: EM132482341

Question 1. Lopez Company received $6,400 on July 1, 2017 for four years' rent in advance and recorded the transaction with a credit to Rent Revenue. The December 31, 2017 adjusting entry is:

Select one:

a. Debit Rent Revenue and credit Unearned Rent, $800

b. Debit Rent Revenue and credit Unearned Rent, $5,600

c. Debit Unearned Rent and credit Rent Revenue, $5,600

d. Debit Unearned Rent and credit Rent Revenue, $6,400

e. Debit Unearned Rent and credit Rent Revenue, $800

Question 2. The accounts to be credited in the closing entries at year-end include:

Select one:

a. Depreciation Expense, Purchases, Freight-In

b. Freight-Out, Purchase Returns, Purchases

c. Purchase Returns, Purchase Discounts, Interest Revenue

d. Prepaid Expense, Depreciation Expense, Freight-Out

e. Depreciation Expense, Purchases, Sales Revenue

Question 3. Which principle is most representative of the accrual basis of accounting?

Select one:

a. Industry Practices

b. Revenue Recognition

c. Full Disclosure

d. Going Concern

Question 4. Indicate the proper journal entry to record payment of a cash dividend previously declared:

Select one:

a. Debit Cash, credit Dividend Payable

b. Debit Dividends, credit Cash

c. Debit Dividends, credit Dividend Payable

d. Debit Dividend Payable, credit Cash

e. Debit Cash, credit Dividends