Which of the Following Adjusting Entries Would Be the Most

question 97

Multiple Choice

Which of the following adjusting entries would be the most likely to be reversed?

• A) Depreciation Expense 1,500 Accumulated Depreciation 1,500
• B) Unearned Rent 700 Rent Revenue 700
• C) Insurance Expense 800 Prepaid Insurance 800
• D) Income Tax Expense 950 Income Taxes Payable 950

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Definitions:

Equity Method

An accounting technique used to record investments in which the investor has significant influence over the investee but does not control it outright.

Consolidation

The process of combining financial statements of a parent company with those of its subsidiaries to present as one economic entity.

Ownership Percentage

The share of ownership interest a person or entity holds in a company, typically expressed as a percentage of the outstanding shares.

Acquisition Method

The method used in accounting for assets acquired and liabilities assumed in a business combination.