Mastering Adjusting Entries - Accrued Revenue and Expenses

All of the quizzes from this book by the AIPB are in these sets
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Terms in this set (...)

Under accrual basis accounting, you recognize revenue...
when you have earned the revenue
Under accrual basis accounting, you recognize an expense when you have...
incurred the expense
Under accrual basis accounting, revenues presented on the income statement are...
revenues earned during the year
Under accrual basis accounting,expenses presented on the income statement are...
expenses incurred during the year
To accrue revenue at year end is to record...
an amount earned for which payment has not been received
To defer revenue is to...
postpone recording a customer's payment as revenue until it is earned
To accrue an expense is to record...
an expense incurred but not yet paid for
To recognize revenue or an expense is to...
record the amount in the general ledger Revenue or Expense account
The general entry to record accrued revenue is
debit AR; credit Revenue
Failure to record accrued revenue...
understates assets, revenues, and net income.
Interest Receivable is what type of account?
Asset
Interest Receivable appears on which financial statement?
Balance Sheet (asset account)
The adjusting entry to accrue revenue...
does not affect the ledger Cash account
Accrued expenses are expenses that have been...
incurred but not yet paid for.
The general entry to record an accrued expense is...
debit expense; credit payable
Failure to record an adjusting entry
Liabilities and expenses will be understated, so net income will be overstated on the income statement.
To record note payable...
debit cash; credit note payable
What kind of account is Taxes Payable?
liability