Questions from College Accounting

Q: What is the purpose of adjusting accounts?

What is the purpose of adjusting accounts?

Q: What is the relationship of internal transactions to the adjusting process?

What is the relationship of internal transactions to the adjusting process?

Q: Explain how an adjustment can affect both the income statement and balance

Explain how an adjustment can affect both the income statement and balance sheet. Please give an example.

Q: Explain why figures for beginning and ending inventory are not combined on

Explain why figures for beginning and ending inventory are not combined on the Income Summary line of the worksheet.

Q: Why do we need the Accumulated Depreciation account?

Why do we need the Accumulated Depreciation account?

Q: Depreciation expense goes on the balance sheet. True or false.

Depreciation expense goes on the balance sheet. True or false. Why?

Q: Each month Accumulated Depreciation grows while Equipment goes up. Agree or

Each month Accumulated Depreciation grows while Equipment goes up. Agree or disagree? Defend your position.

Q: Define the term accrued salaries.

Define the term accrued salaries.

Q: Why don’t the formal financial statements contain debit or credit columns?

Why don’t the formal financial statements contain debit or credit columns?

Q: When a worksheet is completed, what balances are found in the

When a worksheet is completed, what balances are found in the general ledger?