31. The cost of a depreciable asset less accumulated depreciation reflects the book value of the asset.
32. Adjusting entries impact at least one income statement and at least one statement of financial position account.
33. An adjusting entry that increases an expense on the income statement and decreases an asset on the statement of financial position is the result of prepaid expenses that expire with the passage of time.
34. A contra account found on the statement of financial position behaves contrary to accounting rules by being debited on the right and credited on the left.
35. Unearned revenue on the books of Chocolate Company, the landlord, can be a prepaid asset on the statement of financial position of its tenant, Cupcake, Inc.
36. When a company receives cash for future service, it debits unearned revenue on the income statement and credits cash on the statement of financial position.
37. Unearned revenue is reported on the income statement whereas deferred revenue is reported on the statement of financial position.
38. An adjusting entry for accrued revenues increases an asset account on the statement of financial position and increases a revenue account on the income statement.
39. Accrued expenses result in an adjustment to both the income statement and the statement of financial position.
40. Accrued revenues are revenues that have been earned and received before financial statements have been prepared.