99%(101)100 out of 101 people found this document helpful
This preview shows page 3 - 4 out of 4 pages.
Prepaid Insurance is an asset account that appears on the balance sheet- True17. Which of the following statements is true of accrual basisaccounting?A. Accrual basis accounting records revenue only when cash is received.B. Accrual basis accounting always results in greater net income than cash basis accounting.C. Accrual basis accounting records expenses only when cash has been paid for them.D. Accrual basis accounting is required by Generally Accepted Accounting Principles(GAAP).18. On September1, Advantage Maintenance Company contracted to provide monthly maintenance services for the next six months at a rate of $2,000 per month. The client paid Advantage $12,000 September 1. The maintenance services began on that date. Assuming Advantage records deferred revenues using the alternativetreatment, what would be the adjusting entry recorded on December31?on
19. The trial balance is also known as the balance sheet.20. Marcy's Event PlanningServices, Inc. records deferred expenses and deferred revenues using the alternative treatments. The business makes adjusting entries as needed to bring its books to the full accrual basis once a year at the end of the year. On October1, Marcy's paid$3,600 for insurance for a one−year period. At the end of theyear, it will make an adjusting entry that debits Insurance Expense for$1,500.