CITIZEN UNIVERSITY OF NUEVO LEÓN

Bachelor's Degree in Administration with an Accentuation in Business

ACCOUNTING III

TOPIC: SETTINGS

QUESTIONNAIRE 3

CP TUTOR ROSALINDA BARRIENTOS DE LA ROSA

Classroom: A

Student Name: STEPHANIE ESMERALDA CRUZ PERALES

Registration: 44878

Preparation Date: Monday, June 21, 2021

Platform Shipping Date:

Guadalupe, Nuevo León on June 21, 2021

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INTRODUCTION

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Questionnaire

Part 1

1. Explain why it is necessary to make adjustments to the accounting information.

These adjustments and corrections are necessary to be able to issue financial statements

adjusted to the economic and financial reality of the company, in addition to complying

with accounting principles.

2. What does the postulate of association of costs and expenses with income refer to and

what relationship does it have?

With the adjustment procedure?

The costs and expenses of an entity must be identified with the income they generate in

the same period, regardless of the date on which they are made; their relationship with

the adjustment process is involved with the procedure of the necessary corrections.

3. What does the accounting period assumption consist of and what is the relationship

with the adjustment process

Accountants?

The supposed accounting period assumes that the activities of the economic organization

are divided into periods: monthly, quarterly, four-monthly, semi-annual, or annually,

usually organizations prepare quarterly reports and an annual report, for its part the

postulate of cost association and expenses with income aims to make an adequate

comparison of one with the other in the same accounting period.

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4. What characteristics must an adjustment seat have to be considered as such?

Each entry or adjustment affects an account in the statement of financial position or

balance sheet and one in the income statement; consequently, if the entry does not affect

an income or expense account, it is not considered an adjusting entry.

5. What are the types of adjustments necessary for income accounts and what is the

purpose of

What are they made?

Uncollected accrued income

Advances from customers that are recorded as liabilities and that, when accrued, will

become income, are necessary to ensure that all income obtained in the period has been

recorded in the accounting, so that the net profit is expressed in correctly in the income

statement.

6. Mention three examples of adjusting entries that are related to income accounts.

Accounts receivable for services performed

Royalties receivable for rights accrued for publications

Repair services and rentals earned on company-owned properties

7. Describes the accounting treatment that should be given to unrecorded accrued

income.

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The adjustment for such revenue requires a debit to an account receivable and a credit to

a revenue account.

8. What is the accounting recording procedure that generally must be done for

adjustments related to expense accounts?

They require a debit to an expense account and a credit to an asset or liability account.

9. Describe the types of adjustments that relate to expense accounts and explain the

purpose of

Let them be elaborated.

Accrued expenses that have not yet been recorded or paid

Prepaid expenses that were recorded as an asset when paid

Distribution of the cost of a fixed asset throughout its useful life through the depreciation

process

10. When does an advance expense occur and what accounting treatment should it be

given?

Occurs when expenditures are made that cover one or more future accounting periods,

when payment is made before the expense has been incurred or before it has become

due, a charge is generally made to the expense asset account. paid in advance, because it

represents an unearned cost, which will be used in future periods to produce income.

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11. Investigate what the concept of depreciation means for accounting issues and explain

each one

Of the elements that are considered for its calculation.

It consists of recognizing that with the passage of time and the use given to a certain type

of asset, its value loses or decreases.

12. What is an adjusted trial balance?

After journalizing the adjusting entries and posting them to the ledger, an adjusted trial

balance is prepared to verify the accuracy of the ledger, before preparing and updating

the year-end financial statements.

Part 2

Select the correct answer.

1. The entries used to update the asset, liability, income and expense accounts are

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They call:

a ) Journal entries.

b ) Closing entries.

c ) Adjustment seats.

d ) Accounting entries.

e ) None of the above.

2. Adjusting entries are often made as follows:

a ) Monthly.

b ) Quarterly.

c ) Annual.

d ) Daily.

e ) Only a, b and c.

3. The starting point to start the adjustment procedure is:

a ) The classification in the general ledger.

b ) The adjusted trial balance.

c ) Accounting records.

d ) The trial balance before adjustments.

e ) None of the above.

4. The purpose of making the adjustment entries to the income accounts is:

a ) Express the income correctly in the income statement.

b ) Correctly express the net profit in the income statement.

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c ) Recognize the income obtained in the accounting period.

d ) Recognize the profit obtained in the accounting period.

e ) Only by c.

5. Some examples of unrecorded accrued income are:

a ) Royalties receivable for rights accrued for publications.

b ) Customer advances.

c ) Accounts receivable for services performed.

d ) Only ay c.

e ) None of the above.

6. The procedure to follow to adjust advance payments for services provided

is:

a ) It is charged to the liability account called customer advances.

b ) It is charged to the cash or bank account.

c ) It is credited to the liability account called customer advances.

d ) It is credited to the cash or bank account.

e ) Only by c.

7. For accounting or financial purposes the term accrual means:

a ) Get even.

b ) Incurr.

c ) Spend.

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d ) Register.

e ) Only a and b.

8. Prepaid expenses, such as insurance and rent, represent:

a ) A liability.

b ) An expense.

c ) An income.

d ) An asset.

e ) None of the above.

9. The only fixed assets whose value does not deteriorate are:

a ) The buildings.

b ) The machinery.

c ) The transport equipment.

d ) The land.

e ) None of the above.

10. Depreciation expense does not represent a real outlay of money, which is why it is known as

As:

a ) A real game.

b ) An accounting item.

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c ) A virtual game.

d ) A visual game.

e ) None of the above.

Part 3

1. For each of the following operations, indicate in the first column whether an income adjustment or an
expense adjustment is required at the end of the accounting period, and in the second column specify
what type of adjustment it would be: unrecorded accrued income, customer advances, unrecorded
accrued expenses, prepaid expenses or depreciation expense.

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OPERATION INCOME OR EXPENSE ADJUSTMENT TYPE

ADJUSTMENT
SERVICES PERFORMED THAT income adjustment Unrecorded accrued income
WILL BE CHARGED LATER
WAGES FOR THE PERIOD THAT Expense adjustment Unrecorded accrued expenses
HAVE NOT BEEN PAID
CONSUMPTION OF OFFICE income adjustment Advance payment income
MATERIALS
SERVICES CHARGED income adjustment Customer advance income
PREVIOUSLY AND THAT WERE
PERFORMED IN THIS PERIOD
DEPRECIATION OF OFFICE Expense adjustment Depreciation expense
EQUIPMENT
EXPIRATION OF AN INSURANCE Expense adjustment Prepayment fees
POLICY
TAXES OF THE PERIOD TO BE Expense adjustment Prepayment expense
PAID LATER
USE OF A WAREHOUSE WHOSE Expense adjustment Prepayment fees
RENT WAS PAID PREVIOUSLY

INTEREST ON A BANK LOAN TO income adjustment Unrecorded accrued income

BE PAID WHEN THE LOAN IS
DUE

CONSUMPTION OF GASOLINE income adjustment Unrecorded accrued income

VOUCHER
PAYMENTS FOR DIFFERENCES
IN MONTHLY IMSS QUOTES,
INPC AND SURCHARGES
PAYMENTS FOR DIFFERENCES
IN BI-MONTHLY QUOTES OF
INFONAVIT, INPC AND
SURCHARGES
USE OFFICES FOR RENT FOR
PREVIOUSLY PAID BRANCHES

2. Below are some accounts of a trial balance before adjustments, for each one it indicates whether at
the end of the accounting period it requires some type of adjustment or not. If yes, indicate what type of
adjustment it would be:

ACCOUNT ANSWERS
BANKS Does not require any type of adjustment
CUSTOMERS Does not require any type of adjustment
INSURANCE PAID IN ADVANCE Cats paid in advance

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LAND Does not require any type of adjustment

OFFICE TEAM Depreciation expense
ACCUMULATED DEPRECIATION OF OFFICE Depreciation expense
EQUIPMENT
SUPPLIERS Does not require any type of adjustment
CUSTOMER ADVANCES Advance customers
BANK LOAN PAYABLE Unrecorded accrued expenses
RETAINED EARNINGS Does not require any type of adjustment

To know more…
3. The following sections provide information that shows the need to make an adjustment
Of expenses. For each one, indicate the corresponding amount:

a ) There are three employees who earn $850 each for a six-day week. The term
Accounting ends on September 30, which is a Tuesday; However, employees are
He will pay his salary on Saturday, October 4.
The salary expense for the last week that corresponds to September is $___ 850 _______.

b ) On August 10, a bank loan was obtained for $500,000, which will be paid in three months. He
At the end of three months, the Bank will charge interest at a rate of 10% per year.
The interest expense for the month of August is $_____ 2916 ______________.

c ) An insurance policy was purchased for $120,000 with a validity of one year.
The monthly insurance expense is $______ 10000 _____________.

4. In accordance with the information provided for the preparation of income adjustments to the
End of the accounting period, calculate the amount of the corresponding adjustment:

a ) Credit services were performed during the period for a total of $130,000, which has not been
Registered.
The service income adjustment for the period is $______ 130,000 ___________.

b ) On January 2, $250,000 was received as an advance payment for services from a client to
That you will be given advice on computer services for five months.
The adjustment to earned service income as of January 31 is $____ 50,000 _______.

c ) Of the total income for a period, a part was not recorded because it was on credit. Income
Totals were $875,000, 20% was on credit.
The service income adjustment (unrecorded) is $____ 175,000 _________.

5. On February 15, a delivery truck was purchased for $350,000; it was estimated to have a useful life of
seven
Years and a salvage value of $80,000. Determine the following:

a ) The depreciation expense for the month of February is $____ 1607.14 ____________.

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b ) The accumulated depreciation as of February 28 is $____ 1607.14 ____________.

c ) The depreciation expense for the month of March is $_____ 3214.29 ___________.

d ) The accumulated depreciation as of March 31 is $_____ 4821.43 ___________.

e ) The depreciation expense for the month of December is $____ 3214.29 __________.

f ) The accumulated depreciation as of December 31 is $___ 33,750 ____________.

6. The following information corresponds to the company Ritcher, SA during October 200X:

a ) The depreciation expense for furniture and equipment is $20,000 per month.

b ) The interest corresponding to the bank loan is $12,000 per month.

c ) The company paid the rent corresponding to the entire year in advance, in such a way that
The amount of $16,000 per month must be recognized as rent.

It is requested:
Prepares the recording of adjusting entries in the journal.
Richter SA
General diary
October / 200X
Values in RD$

DATE DETAIL ASSISTAN HAS TO TO HAVE

T
30- OCT Transportation equipment depreciation 20,000.00
expense

Accumulated depreciation of
transportation equipment
20,000.00
DET. Equipment depreciation record for the
month of October. Depreciation Entry.
30- OCT Interest expenses 12,000.00

Interest payable 12,000.00

DET Register of interest payable
30-OCT Prepaid insurance 192,000.00

Banks
192,000.00
DET Record of payment of the income
premium for the year, Origin of the

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transaction.
30-OCT Insurance expenses 16,000.00

Prepaid insurance
16,000.00
DET. Record of income consumption for the
month of October. adjustment seat

7. Based on the following information, prepare the adjusting entries as of December 31, 200X,
Closing date of the annual accounting period:

a ) Machinery was purchased on March 1, 200X for $400,000, which has a useful life of
Four years and it is estimated that it will depreciate in equal parts each month.

b ) On April 3, annual fire insurance was purchased for $240,000, which was paid in advance
Cash.

c ) On May 2, a bank loan of $300,000 was requested, with an annual interest of 12% payable
Monthly.

DATE CONCEPT HAS TO TO HAVE

01-MARCH-14 1
Machinery depreciation expenses 8,333.00

Accumulated depreciation of machinery

8,333.00
03-APRIL-14 Machinery operation record of the month
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Prepaid insurance 240,000.00
Banks 240,000.00
For payment of fire insurance expenses
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02-MAY-14 Interest expenses 3,000.00
Interest payable 3,000.00
Interest accumulated during the month of
December

8. On July 10, Constructora Edursa collected $2,750,000 in advance for services

Consulting on the design and construction of an apartment building. The advance corresponds to
A period of six months from when the check was delivered. Determine the following:

a ) The income adjustment for services earned as of July 31 is $____ 458,333.33 _____________.

b ) The balance of the customer advances account as of July 31 is $____ 2,291, 666.67 _____________.

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c ) The income adjustment for services earned as of August 31 is $___ 458,333.33 ___________.

d ) The balance of the customer advances account as of August 31 is $____ 1,833, 333.34 ___________.

e ) The balance of the customer advances account as of December 31 is $____ 0 ___________.

f ) When should the last earned service income adjustment be made? ___ 10-DEC ____.

g ) What would be the amount of the adjustment? $_____ 458,333.33_____________.

9. When an adjusting entry is made, an income statement account (income or

Expense) and a balance sheet account (asset or liability). For each of the settings
They mention, determines which is the income statement account that is affected and which is the
From the general balance that is modified:

FITMENT INFORMATION INCOME STATEMENT BALANCE SHEET ACCOUNT

SALARIES FOR THE PERIOD
WHICH HAVE NOT BEEN PAID
WERE RECOGNIZED
SERVICES PERFORMED AND
NOT CHARGED WERE
RECORDED
DEPRECIATION OF OFFICE
EQUIPMENT WAS RECORDED
THE PART OF THE FIRE
INSURANCE THAT EXPIRED WAS
RECOGNIZED
THE CONSUMPTION OF OFFICE
MATERIALS WAS RECORDED
THE INTEREST FOR THE PERIOD
THAT IS DUE WAS RECORDED
THE PERFORMANCE OF
SERVICES CHARGED IN
ADVANCE WAS RECOGNIZED
THE PART OF THE RENT PAID IN
ADVANCE THAT IS ALREADY
DUE WAS RECOGNIZED

10. The following format presents some accounts of the trial balance before adjustments, adjustments
and the adjusted trial balance as of December 31. Explain what each of the settings presented consists
of :

ACCOUNT SCALE SETTING ADJUSTED

BEFORE S SCALE
ADJUSTM
ENTS

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HAS TO TO HAS TO TO HAS TO TO

HAVE HAVE HAVE
RENT PAID IN ADVANCE 5) 6,000 30,000
36,000
DELIVERY TEAM 250,000 250,000
ACCUMULATED 0 4)25,000 25,000
DEPRECIATION OF
DELIVERY EQUIPMENT
CUSTOMER ADVANCES 100,000 1)20,000 80,000
WAGES TO PAY 0 2)8,000 8,000
INTEREST PAYABLE 3)7,500 7,500
SERVICE REVENUES 340,000 1)20,000 360,000
SALARY EXPENSES 56,000 2) 8,000 64,000
INTEREST EXPENSES 0 3) 7,500 7,500
DEPRECIATION EXPENSES 0 4)25,000 25,000
RENT EXPENSES 0 5) 6,000 6,000

1. ________________________________________________________________________________
2. ________________________________________________________________________________
3. ________________________________________________________________________________
4. ________________________________________________________________________________
5. ________________________________________________________________________________

CONCLUSION

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BIBLIOGRAPHY

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REFERENCES

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