Deferrals and Accruals Quiz Form
Test your knowledge of deferrals and accruals with this comprehensive quiz. Please answer all questions to the best of your ability.
Which of the following best describes a deferral in accounting?
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Revenue or expense recorded after cash is received or paid
Revenue or expense recorded before cash is received or paid
Only revenue recorded before cash is received
Only expense recorded after cash is paid
Select all examples that represent accrual accounting entries.
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Interest earned but not yet received
Prepaid insurance
Wages payable
Unearned revenue
Rent received in advance
In accrual accounting, when are revenues recognized?
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When cash is received
When the earning process is complete and collection is reasonably assured
At the end of the fiscal year
When expenses are paid
Provide a short definition of an accrual.
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A company receives $6,000 in advance for a 12-month service contract starting July 1. How much revenue should be recognized by December 31?
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Select the correct journal entry for recording accrued expenses.
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Debit Expense, Credit Liability
Debit Liability, Credit Expense
Debit Asset, Credit Revenue
Debit Revenue, Credit Asset
Which of the following is NOT an example of a deferral?
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Prepaid rent
Unearned revenue
Accrued salaries
Prepaid insurance
Enter the date when adjusting entries for accruals are typically made.
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Month
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Day
Year
2 digit month, 2 digit day, 4 digit year
Date
Which statement is true about deferrals and accruals?
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Deferrals delay recognition of revenues or expenses, accruals accelerate recognition
Deferrals and accruals both delay recognition
Accruals delay recognition, deferrals accelerate recognition
Neither affect timing of recognition
Briefly explain why adjusting entries for deferrals are necessary.
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