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35 Cards in this Set
- Front
- Back
The merchandise inventory account is never debited or credited during the year using the periodic method
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True
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Two adjustments are made to the merchandise inventory account on the work sheet.
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True
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The merchandise inventory account always reflect the current inventory on hand
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False
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The amount of inventory on hand is determined by physically counting the goods on hand and determining the cost of those goods
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True
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at the end of the accounting period, the merchandise inventory account is debited for the beginning inventory amount.
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False
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Both the debit and credit amounts in the merchandise inventory account at the end of an accounting period are used to calculate the cost of goods sold.
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True
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The credit amount for the income summary in the Adjusted Trial Balance column reflect the inventory on hand at the end of the accounting period.
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True
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Merchandise Inventory has a normal debit balance
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True
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if the ending inventory is overstated for any reason, net income will also be overstated
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True
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If beginning inventory is 30,000 and ending inventory is 25,000, the cost of the inventory on hand at the end of the accounting period is 25,000.
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True
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After adjustments are made to merchandise inventory account and posting is completed the income summary account will reflect bot the amount of beginning and ending inventory
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true
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the income summary account will always reflect the same balance as the merchandise inventory account an the end of the accounting period.
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False
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If beginning inventory is 12,000 and ending inventory is 9,000 the first step in the adjusting process is to credit merchandise inventory for 9,000
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False
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if the beginning inventory is 80,000 and ending inventory is 10,000 the balance of the merchandise inventory account after adjustment will be 70,000
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False
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The credit to the merchandise inventory account when making adjustments at the end of the accounting period will be the same amount as was debited at the en of the previous accounting period.
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True
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Some business require payment before delivering a product or performing a service.
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True
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cash received in advance for performing a service or delivering a product is called unearned revenue.
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True
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Unearned revenue is a liability
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True
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Under the accrual basis if accounting revenue is recorded when earned regardless of when cash is received
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True
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the transaction to record unearned revenue results in an asset account.
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True
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when unearned revenue is finally earned, a revenue account is debited to reflect the amount of the revenue earned.
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False
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The balance of Unearned Revenue is reported on the income statement at the end of the accounting period.
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False
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An increase in a revenue account may reflect a decrease in a liability account.
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True
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An increase in a revenue account may reflect in an increase in an asset account.
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True
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Purchases Return and Allowance is a contra-cost account.
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False
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Purchase Discount is a contra-cost account.
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True
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Adjustments are made on the work sheet for both beginning and ending merchandise inventory.
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True
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A contra revenue account is given a "1" extension to its related ledger accounts number.
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True
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when part of the amount of unearned revenue has been earned, the unearned revenue account must be adjusted.
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True
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When part of the amount of unearned revenue has been earned an the account adjusted accordingly a revenue account must be adjusted by that partial amount.
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True
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only the debit amount for the income summary account must be extended in the work sheet.
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False
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the adjusted balance of the merchandise inventory account is extended to the Balance Sheet columns of the work sheet.
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True
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only the debit adjustment amount in the merchandise inventory account is extended to the adjusted Trial Balance columns of the work sheet
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True
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only the adjusted credit balance in the merchandise inventory account is extended to the adjusted Trial Balance columns of the work sheet
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False
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Making adjustment on the work sheet has no effect on the actual accounts in the general journal.
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True
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