1)Which of the following does not correctly describe an adjusting journal entry that debits interest expense and credits interest payable?    It increases expenses and decreases retained earnings

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1)Which of the following does not correctly describe an adjusting journal entry that debits interest expense and credits interest payable?
   It increases expenses and decreases retained earnings.
   It decreases net income and decreases stockholders' equity.
   It increases expenses and increases liabilities.
   It decreases assets and decreases stockholders' equity.

2)Which of the following does not correctly describe an adjusting journal entry that debits rent expense and credits prepaid rent?
   It increases expenses and decreases stockholders' equity.
   It decreases net income and decreases assets.
   It increases expenses and decreases current assets.
   It decreases net income and decreases liabilities.

3) Which of the following correctly describes the effects of accruing income tax expense at year-end?
   A cash payment is made to pay the taxes due.
   Liabilities are not affected.
   Retained earnings decreases.
   Net income increases.

4)Which of the following correctly describes the effects of initially recording prepaid insurance expense when cash is paid to purchase an insurance policy?
   Total assets do not change.
   Net income decreases.
   Liabilities are decreased.
   Stockholders' equity increases.