23) The final step in the accounting cycle is to A) prepare an adjusted trial ba

Question

23) The final step in the accounting cycle is to A) prepare an adjusted trial balance B) close temporary accounts C) prepare a post-closing trial balance D) prepare financial statements 24) Which of the following is a characteristic of rules-based standards? A) involve few, if any, exceptions B) result in inconsistencies between standards C) contain no bright-line tests D) provide insufficient guidance 25) Purrfect Pets, Inc. provides animal daycare for $25 per day Customers buy three month packages, which provide 15 days of care per month. In January, they received cash payments from 10 customers. For the month of February, they will recognize- cash basis, and A) $0, $250 B) $3,750, $3,750 C) $250, $250 D) $0, $3,750 of revenue under the of revenue under the accrual basis. 26) Arnold Company provided services to its customers on credit for $25,000. This transaction . A) increased assets B) increased liabilities C) increased expenses D) decreased shareholders' equity The is generally one of the first notes to the financial statements A) accounting policies footnote B) contingencies footnote C) employee benefits footnote D) intangibles explanation footnote 27) 71Page Anakwe-Intermediate I, Fall 2017 Final Exam

Explanation / Answer

23)

option D ( preparation of financial statement)

all other options are done before preparation of financial statement

24) option B ( result in inconcistensies between standards )

25) option D ($0, $ 3750)

under cash system they already recogaized all revenue in the month of january on receipt of cash. so no revenue recoganized in the monthn of february under cash system. i accrual cocept only the revenue related to perticular month recoganized, balnce treated as advance receipt.

26) option A ( incraesed asset)

credit sale increase account receivable

27) option B ( contigencies footnote)

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