CHAPTER 4

CHAPTER 4 - CHAPTER 4 Accrual Accounting Concepts Study...

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Unformatted text preview: CHAPTER 4 Accrual Accounting Concepts Study Objectives 1. Explain the revenue recognition principle and the matching principle. 2. Differentiate between the cash basis and the accrual basis of accounting. 3. Explain why adjusting entries are needed, and identify the major types of adjusting entries. 4. Prepare adjusting entries for prepayments. 5. Prepare adjusting entries for accruals. 6. Describe the nature and purpose of the adjusted trial balance. 7. Explain the purpose of closing entries. 8. Describe the required steps in the accounting cycle. Summary of Questions by Study Objectives and Blooms Taxonomy Item SO BT Item SO BT Item SO BT Item SO BT Item SO BT Questions 1. 1 C 8. 4 K 15. 5 C 22. 6 C 29. 7 K 2. 1 K 9. 4 C 16. 5 K 23. 2 C 30. 8 K 3. 1 C 10. 4 C 17. 5 AN 24. 6 C 31. 8 K 4. 1 AP 11. 4 K 18. 5 AP 25. 7 K 32. 8 C 5. 3 C 12. 4 K 19. 5 K 26. 7 C 33. 8 C 6. 3 C 13. 1 C 20. 5 K 27. 7 C 34. 9* K 7. 3 C 14. 1 AN 21. 5 C 28. 7 K 35. 9* K Brief Exercises 1. 2 C 4. 4 AP 7. 4 AP 10. 6 AP 13. 7 K 2. 3 C 5. 4 AP 8. 5 AP 11. 6 AP 14. 8 K 3. 3 AN 6. 4 AP 9. 6 AN 12. 6 K Exercises 1. 1 C 5. 2 AP 9. 4, 5 AP 13. 1, 4, 5, 6 AN 16. 6 AP 2. 1 K 6. 2, 4, 5 AP 10. 4, 5 AP 14. 4, 5, 6 AN 17. 7 AP 3. 1 C 7. 2, 3 C 11. 4, 5 AP 15. 4, 5, 6 AP 4. 2, 4, 5 AP 8. 3, 4, 5 AN 12. 1, 4, 5, 6 AP Problems: Set A 1. 2, 4 AP 3. 4, 5, 6, 7 AP 5. 4, 5 AP 7. 4, 5, 6 AP 8. 4, 5, 6, 7, 8 AP 2. 4, 5, 6 AP 4. 4, 5, 6, 7 AP 6. 4, 5 AN Problems: Set B 1. 2, 4 AP 3. 4, 5, 6, 7 AP 5. 4, 5 AP 7. 4, 5, 6 AP 8. 4, 5, 6, 7, 8 AP 2. 4, 5, 6 AP 4. 4, 5, 6, 7 AP 6. 4, 5 AN 4-1 ASSIGNMENT CHARACTERISTICS TABLE Problem Number Description Difficulty Level Time Allotted (min.) 1A Record transactions on accrual basis; convert revenue to cash receipts. Simple 2030 2A Prepare adjusting entries, post to ledger accounts, and prepare an adjusted trial balance. Simple 4050 3A Prepare adjusting entries, adjusted trial balance, and financial statements. Simple 5060 4A Prepare adjusting entries and financial statements; identify accounts to be closed. Moderate 4050 5A Prepare adjusting entries. Moderate 3040 6A Prepare adjusting entries and a corrected income statement. Moderate 3040 7A Journalize transactions and follow through accounting cycle to preparation of financial statements. Moderate 6070 8A Complete all steps in accounting cycle. Moderate 7080 1B Record transactions on accrual basis; convert revenue to cash receipts. Simple 2030 2B Prepare adjusting entries, post to ledger accounts, and prepare adjusted trial balance. Simple 4050 3B Prepare adjusting entries, adjusted trial balance, and financial statements. Simple 5060 4B Prepare adjusting entries and financial statements; identify accounts to be closed....
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This note was uploaded on 06/03/2008 for the course BUAD 305 taught by Professor Davila during the Spring '07 term at USC.

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CHAPTER 4 - CHAPTER 4 Accrual Accounting Concepts Study...

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