Answer the following statements true (T) or false (F)
1. In accrual accounting, accrued revenues are recorded as liabilities.
2. Depreciation expense is an example of an accrued expense.
3. Earned but uncollected revenues are recorded during the adjusting process with a credit to a revenue account and a debit to an expense account.
4. Depreciation expense for a period is the portion of a plant asset's cost that is allocated to that period.
5. All plant assets, including land, are depreciated.
1. FALSE
2. FALSE
3. FALSE
4. TRUE
5. FALSE
You might also like to view...
Which of the following is not identified by Porter as one of the possible types of barriers to entry in an industry?
A) loose bricks B) switching costs C) economies of scale D) product differentiation E) access to distribution channels
An automobile parts retailer purchases merchandise inventory for cash. When using a manual accounting information system, this transaction is recorded in the ________.
A) purchases journal B) general journal C) cash payments journal D) sales journal
Small and medium-size companies lack the competitive advantage to compete with large multinational corporations and therefore have little to contribute to the international marketplace
Indicate whether the statement is true or false
Mackinaw Manufacturing Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 17,000 actual direct labor-hours and incurred $145,000 of actual manufacturing overhead cost. They had estimated at the beginning of the year that 16,000 direct labor-hours would be worked and $144,000 of manufacturing overhead costs incurred. The Corporation had calculated a predetermined overhead rate of $9 per direct labor-hour. The Corporation's manufacturing overhead for the year was:
A. overapplied by $8,000 B. overapplied by $1,000 C. underapplied by $1,000 D. underapplied by $8,000