assets in accounting coursera week 1 quiz answers

Categorize These Assets

1. Which of these would be considered a current asset? Select 2.

(select ALL that apply, if you don't it will not give you the point)

  • Accounts receivable
  • Prepaid expenses
  • Accumulated depreciation
  • Vehicle

2. How would you categorize $3,500 worth of computer equipment that the business will use as part of its operations?

  • Current assets
  • Long-term assets
  • Equity

Reading Quiz

3. In prepaid expense accounting, these expenses are ________ assets.

  • Current
  • Non-current

4. Accountants consider prepaid rent ______________ on your financial statements.

  • A liability
  • An asset

Assets Practice Quiz

5. To book Prepaid Expenses, you must be using which type of accounting method?

  • Cash
  • Accrual

6. Rent for Eternal Summer is $1,200/month, but if it is prepaid, rent is only $12,000 for the year. If Eternal Summer pays $12,000 on January 1, how would you book this transaction?

  • Debit Cash for $12,000 and Credit Prepaid rent for $12,000.
  • Debit Prepaid rent for $12,000 and Credit Cash rent for $12,000.

7. What happens on Feb 1? Remember that $1,000 (1/12) of the $12,000 Prepaid rent has been “used up” or realized as an expense during January.

So we need to _____ Prepaid rent (asset account) and _____ Rental expense (expense account)

  • Debit, Credit
  • Credit, Debit

8. What would the balance in the Prepaid rent account be on May 1?

  • $11,000
  • $10,000
  • $9,000
  • $8,000

Shuffle Q/A 1

9. If we run a Profit & Loss (or Income Statement) for Eternal Summer for the month of April, which of these would appear on the statement?

  • Rental Expense $1,000.
  • Prepaid rent $8,000.

10. If we create a Balance Sheet for Eternal Summer on May 1st, which of these would appear on the statement?

  • Rental Expense $1,000
  • Prepaid Rent $8,000

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