Tutorial 3

1.

The adjusting entry to record the depreciation of Building for the accounting period
A.
B.
C.
D.

is:

Debit Depreciation Expense; credit Building

Debit Depreciation Expense; credit Accumulated Depreciation
Debit Accumulated Depreciation; credit Depreciation Expense
Debit Building; credit Depreciation Expense

2.
The net income reported on the Statement of Comprehensive Income is RM75,000.
However,
adjusting entries have not been made at the end of the period for utilities expenses of RM750 and accrued
wages of RM1,950. Adjusted net income is:
A.
B.
C.
D.
3.

Advanced deposit is reported on the Statement of Financial Position as a:

A.
B.
C.
D.

4.

RM72,300
RM73,050
RM75,000
RM75,750

Non-current liability
Non-current asset
Current liability
Current asset

The balance in the capital account after all closing entries have been posted is:
A.
B.
C.
D.

Equal to net income or loss for the period

The same as the balance on the Adjusted Trial Balance
The same as the balance on the Unadjusted Trial Balance
The balance that will appear on the Statement of Financial Position

5.
On 1 August 2013, Axia Sdn Bhd paid RM72,000 cash for six-months rent. The
prepaid rent on 31 December 2013 after adjustment would be:
A.
B.
C.
D.

balance in the

RM12,000
RM18,000
RM24,000
RM36,000

6.
Salaries Payable was RM7,000 at the end of October and RM5,600 at the end of November. Wages
Expense for November was RM40,000. How much cash was paid for wages during November?
A.
B.
C.
D.
7.

RM27,400
RM38,600
RM41,400
RM52,600

How do the adjusting entries differ from other journal entries?

A.
Adjusting entries always include debits or credits to at least one income
statement account and at least one balance sheet account
B.
Adjusting entries are made only at the end of the period
C.
Adjusting entries never affect the amount of cash
D.
All of the above are true

Pandalela Enterprise account balances as at 31st December 2013 are given as follows:
Cash
Accounts Receivable
Prepaid Insurance
Supplies
Office Equipment
Accum. Depreciation Building
Accounts Payable
Salbiah, Capital
Service Revenue
Salaries Expense
Rent Expense
8.

RM
800
2,000
200
600
1,600
800
1,200
2,400
2,000
400
800

If on 31 December, 2013, supplies on hand were RM180, the adjusting entry would
A.
B.
C.
D.

Credit to Supplies for RM180

Credit to Supplies Expense for RM420
Debit to Supplies Expense for RM420
Debit to Supplies for RM180

9.
If as of 31 December, 2013, the rent of RM400 for December had not been recorded
This will cause:
A.
B.
C.
D.

contain a:

or paid.

Net income to be understated

Liabilities to be overstated
Asset to be understated
Owners Equity to be overstated

10.
A consultant firm received RM14,000 cash for services to be rendered in the
future. The full
amount was credited to the liability account Unearned Consulting Fees. If the legal services have been
rendered at the end of the accounting period and
no adjusting entry is made, this would cause:
A.
B.
C.
D.

Expenses to be overstated
Net income to be overstated
Liabilities to be understated
Revenues to be understated

11.
If a resource has been consumed but a bill has not been received at the end of the accounting period,
then:
A.
B.
C.
D.

An expense should be recorded when the bill is received

An expense should be recorded when the cash is paid out
An adjusting entry should be made recognizing the expense
It is optional whether to record the expense before the bill is received

12.

The purpose of adjusting entries is most of the time due to the following, EXCEPT:
A.
Because some earnings are realized with the passage of time and have not yet
been journalized
B.
When the company's profits are below the budget
C.
When expenses are recorded in the period in which they are incurred
D.
When revenues are recorded in the period in which they are earned

13.
Muscular Sdn Bhd, a publisher of sports magazine, collected RM135,000 for
subscription
revenue in May. Each subscriber will receive a copy of the magazine for the next 12 months, beginning
with the June issue. The company uses the accrual based accounting. By the end of December, how much
subscription revenue has been
earned?
A.
B.
C.
D.

RM45,000
RM78,750
RM90,000
RM135,000

14.
The information below represents Long Pasia Enterprise Supplies account. How much is the supply
purchased during the period?
Beginning supplies
Supplies purchased
Supplies expense
Ending supplies
A.
B.
C.
D.

RM12,000
?
RM48,000
RM18,000

RM30,000
RM54,000
RM66,000
RM78,000

15.
The accountant for G-Generation Services forgot to make an adjusting entry for depreciation
expense for the current year. Which of the following is one of the effects of this mistake?
A.
B.
C.
D.

Net income is understated

Total assets are understated
Net income is overstated
Expenses are overstated

16.
Running Man Enterprise is working on a six-month job for a client, starting 1
August. They will
collect RM72,000 from their customer when the job is finished.
On 1 September, their Accounts
Receivable account has a debit balance of RM12,000.
At the end of September, after monthly adjusting
entries have been made, what will be the balance in Accounts Receivable account?
A.
B.
C.
D.

Debit balance of RM18,000

Debit balance of RM24,000
Debit balance of RM48,000
Debit balance of RM60,000

17.
Racquet Shop Enterprise received a RM940 check from a customer for the balance
due. The
transaction was erroneously recorded as a debit to Cash RM490 and a credit
to
Service
Revenue
RM490. The correcting entry is
A.
debit Cash, RM940; credit Accounts Receivable, RM940
B.
debit Cash, RM450 and Accounts Receivable, RM490; credit Service Revenue,
RM940
C.
debit Cash, RM450 and Service Revenue, RM490; credit Accounts Receivable,
RM940
D.
debit Accounts Receivable, RM940; credit Cash, RM450 and Service Revenue,
RM490
18.
Given total revenues RM15,300, total expenses RM10,950, and total withdrawals
RM3,900.
What is the balance in the Income Summary account prior to closing net income or loss to the Capital
account?
A.
B.
C.
D.
19.

When there is a net loss, the entry to close the Income Summary account is:
A.
B.
C.
D.

20.

Credit balance of RM450

Debit balance of RM4,350
Credit balance of RM4,350
Debit balance of RM450

Debit Owner's Capital and credit Income Summary

Debit Income Summary and credit Owner's Capital
Debit Net Loss and credit Income Summary
Debit Income Summary and credit Net Loss

Which of the following account is not closed to the Income Summary?

A.
B.
C.
D.

Service Revenue
Depreciation Expense
Withdrawal
Accounts Payable

TUTORIAL # 3

DUE DATE: ____________ 2014

MATRIC NO: _____________

NAME:

GROUP: _____

POSITION NO: ______

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