ACCT Chapter 4

After the adjustments have been recorded, deferred revenue on the balance sheet reports the amount of ______

the sales or services still owed to the customer

When recording an adjustment for the use of equipment during the current accounting period, which two accounts are affected?

Accumulated Depreciation and Depreciation Expense

As the balance in the Accumulated Depreciation increases, total assets ____ because Accumulated Depreciation is a ___ - Account.

Decreases, contra-asset

What are the effects on the accounting equation from the adjustment for which the seller has satisfied the performance obligation to its buyers during the accounting period that had previously been recorded as a liability?

Total liabilities will decrease and total SE will increase

True or False: The adjusting entry to record deprivation does not directly reduce the long-lived asset accounts, such as Equipment, so that the original cost of the asset remains unchanged

True

The adjusting entry to record amortization causes ______

assets to decrease, stockholder's equity to decrease

Amortization is the concept that applies to the ______

expensing of long-term assets that lack physical substance over their useful lives

Gift cards are an example of a transaction in which a company receives payment in advance of fulfilling a sale or performing a service. This type of transaction will result in: 1. an _____ to the account called Cash, an asset and 2. An _______ to the account called _______

increase, deferred revenue, a liability