For each of the following independent situations, determine the effect of ignoring the required 12/31 year-end adjusting entry. Would assets, liabilities, and equity be understated (U) or overstated (O) if the entry is not made? If there would be no effect, leave the cell blank.
| Assets | Liability | Equity | |
|---|---|---|---|
| Cash was received on Dec. 1 when a 2-year lease was signed. Rent revenue was credited on that date. | — | + | |
| Interest is incurred but not yet paid on a long-term note payable | — | + | |
| Equipment with a 5-year life has been used 1 year | — | + | |
| One-half of a prepaid insurance policy has expired | + | + |
The Rest Of TheVideos
| 1 | Not completed | Cash vs. Accrual Accounting | 8 min |
| 2 | Not completed | Expense Recognition | 9 min |
| 3 | Not completed | Accruals and Deferrals | 16 min |
| 4 | Not completed | What is an Adjusting Entry? | 5 min |
| 5 | Not completed | Adjusting Entry: Supplies | 2 min |
| 6 | Not completed | Adjusting Entry: Wages | 5 min |
| 7 | Not completed | Adjusting Entry: Unearned Revenue | 3 min |
| 8 | Not completed | Adjusting Entry: Interest | 3 min |
| 9 | Not completed | Contra-accounts | 5 min |
| 10 | Not completed | Depreciation | 8 min |
Chapter 3Practice Problems
| Click Here to View All Problems at Once | View | ||
| 1 | Not completed | Adjusting Entry Identification | Easy |
| 2 | Not completed | Revenue Journal Entry | Easy |
| 3 | Not completed | Revenue Recognition | Easy |
| 4 | Not completed | Revenue Recognition | Easy |
| 5 | Not completed | Adjusting Entry - Salaries Payable | Moderate |
| 6 | Not completed | Adjusting Entry - Wage Expense | Moderate |
| 7 | Not completed | Determining Net Income From Journal Entries | Moderate |
| 8 | Not completed | Determining Net Income From Transactions | Moderate |
| 9 | Not completed | Prepaid Rent | Moderate |
| 10 | Not completed | Revenue Recognition | Moderate |
| 11 | Not completed | Adjusting Journal Entries | Hard |
| 12 | Not completed | Adjusting Journal Entries | Hard |
| 13 | Not completed | Revenue and Expense Recognition | Hard |
| 14 | Not completed | The Effect of Transactions | Hard |
| 15 | Not completed | When You Forget to do Adjusting Entries You are here. | Hard |