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Problem 1: Which of the following adjusting entries be reversed?
a. an adjusting entry to accrue an expense that is already incurred but not yet paid
b. An adjusting entry to record depreciation
c. An adjusting entry to record bad debt expense
d. An adjusting entry to record the earned portion of an advanced collection of income initially recorded using the liability method.
Problem 2: Which of the following adjusting entries cannot be reversed?
a. An adjusting entry to accrue an expense
b. An adjusting entry to accrue an income
c. An adjusting entry to record the expired portion of a prepayment of an item of expense
d. An adjusting entry to record the unearned portion of an advanced collection of an item of income.
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At her death, Abigail owned 55% of the stock in Finch Corporation, with the balance held by family members. In the past five years, Finch has earned average net profits of $1.6 million, and on the date of Abigail's death, the book value of its stock ..
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