learning objective 3 3 1 accrued revenue is the income that has been received but no 4306786

learning objective 3 3 1 accrued revenue is the income that has been received but no 4306786

Learning Objective 3-3

1) Accrued revenue is the income that has been received but not earned.

2) Prepaid insurance is an asset account and hence it appears on the balance sheet.

3) Prepaid rent is an expense account and hence it appears on the income statement.

4) A contra account's normal balance (debit or credit) is the opposite of the normal balance of the related account.

5) The sum of all the depreciation expense recorded to date for a depreciable asset is called residual value.

6) The depreciation method that allocates an equal amount of depreciation each year is called the straight-line method.

7) In the case of a prepaid expense, the adjusting entry required at the end of a period will consist of a debit to the Prepaid Expense account. Assume the prepaid expense was initially recorded as an asset.

8) In the case of a prepaid expense, the adjusting entry required at the end of a period will consist of a credit to the Prepaid Expense account. Assume the prepaid expense was initially recorded as an asset.

9) In the case of unearned revenue, the cash is received first, and the revenue is earned later.

10) In the case of unearned revenue, the adjusting entry at the end of the period includes a debit to Service Revenue. Assume the unearned revenue is initially recorded as a liability.

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