31) Book value is defined as:
A) depreciation expense plus accumulated depreciation
B) the cost of a capital asset less depreciation expense
C) the cost of a capital asset less accumulated depreciation
D) the cost of a capital asset plus accumulated depreciation
32) Accumulated depreciation is classified as a(n):
A) expense account
B) contra-asset account
C) asset account
D) liability account
33) Honey Brown Inc. paid six months' rent in advance totalling $9,000. At the end of the first month, the adjusting entry would include a:
A) debit to Prepaid Rent for $7,500
B) debit to Prepaid Rent for $1,500
C) debit to Rent Expense for $7,500
D) debit to Rent Expense for $1,500
34) A journal entry contains a debit to an asset account and a credit to a revenue account. This is an example of a(n):
A) accrued revenue
B) deferred expense
C) unearned revenue
D) accrued expense
35) A journal entry contains a debit to an expense account and a credit to a payable account. This is an example of a(n):
A) accrued revenue
B) accrued expense
C) deferred revenue
D) deferred expense
36) The adjusting entry made to record prepaid insurance that has expired during the period would include a debit to:
A) Unearned Insurance
B) Prepaid Insurance
C) Accrued Insurance
D) Insurance Expense
37) Upper Canada Corp. bought $72,000 of equipment with an estimated service life of 4 years. The equipment will be worthless at the end of its life. The annual amount of depreciation on this equipment is:
A) $18,000
B) $36,000
C) $72,000
D) $0
38) Chance stables purchased a new baler as their annual equipment purchase. The baler was purchased for $10,000 down and a $50,000 note with an estimated life of 8 years. The baler will be worthless at the end of its life. The annual amount of depreciation on this equipment is:
A) $7,500
B) $6,250
C) $10,000
D) $50,000
39) A journal entry contains a debit to the Cash account and a credit to the Unearned Service Revenue account. This is an example of a(n):
A) deferred expense
B) accrued expense
C) accrued revenue
D) deferred revenue
40) Shaftebury Ltd. began operations and purchased $15,900 of supplies. By year end, $8,800 of supplies were still on hand. The adjusting entry at year end would include a:
A) debit to Supplies for $8,800
B) credit to Supplies Expense for $7,100
C) credit to Supplies Expense for $8,800
D) debit to Supplies Expense for $7,100