81) To compute net income or net loss, the debit and credit columns of the income statement section of the worksheet are totaled, and the difference is placed on the smaller side.

 

82) Revenue is recorded when earned, and expenses are recorded only when paid.

 

83) The worksheet is the first financial statement prepared.

 

84) What is the purpose of adjusting entries? Discuss the effect of not preparing adjusting entries on various accounts.

 

85) What are the differences between depreciation expense and accumulated depreciation?

86) Equipment was purchased for $20,000, residual value is $2,000 and it is expected that the useful life is 10 years. What is the depreciation adjustment amount after the first year assuming straight-line depreciation?

$ ________

 

87) Equipment was purchased for $20,000, residual value is $2,000 and it is expected that the useful life is 10 years. What is the book value of the equipment after the first year assuming straight-line depreciation?

$ ________

 

 

 



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