An adjusting entry shows a debit to Depreciation Expense. The credit would be to Accumulated Depreciation....

An adjusting entry shows a debit to Depreciation Expense. The credit would be to Accumulated Depreciation. (T/F)

ABC Co. provides contracting services to XYZ Co. XYZ paid ABC in advance (down payment). This would be deferred revenue for ABC. Co (T/F)

To record depreciation for the month you would (A. dr. Accumulated Depreciation and cr. Depreciation Expenses) (B. dr. Depreciation Expenses and cr. Accumulated Depreciation) (C. dr. Depreciation Expense and cr. Cash) (D. none of these are correct)

Adjusting entries can be categorized as accruals or deferrals. (T/F)

Solutions

Expert Solution

An adjusting entry shows a debit to Depreciation Expense. The credit would be to Accumulated Depreciation. (T/F)
The statement is TRUE.
Depreciation expense is Debited [Income Statement account]
Accumulated Depreciation is credited [Balance sheet account].
ABC Co. provides contracting services to XYZ Co. XYZ paid ABC in advance (down payment). This would be deferred revenue for ABC. Co (T/F)
The statement is TRUE.
Amount received as an advance is treated as a LIABILITY [deferred ort unearned revenue] till the time the revenue gets earned.
To record depreciation for the month you would (A. dr. Accumulated Depreciation and cr. Depreciation Expenses) (B. dr. Depreciation Expenses and cr. Accumulated Depreciation) (C. dr. Depreciation Expense and cr. Cash) (D. none of these are correct)
Correct Answer = Option ‘B’
Debit Depreciation expense
Credit Accumulated Depreciation
Adjusting entries can be categorized as accruals or deferrals. (T/F)
TRUE. Adjusting entries are made to adjust the accruals and deferrals of revenues and expenses.

ekkarill92 answered 1 year ago

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