Question 1

The income summary account is also called

Accepted Answer

A)   the imprest account
B)   the clearing account
C)   the adjustments account
D)   the helpful accountE) B) and D)
F) A) and C)

Question 2

Accumulated depreciation appears on the

Accepted Answer

A)   balance sheet in the current assets section
B)   balance sheet in the property, plant and equipment section
C)   balance sheet in the long-term liabilities section
D)   income statement as an operating expenseE) All of the above
F) A) and C)

Question 3

Prepaid Insurance is an example of a current asset.

Accepted Answer

A) True 
 B)False

Question 4

On the basis of the following information taken from the Adjusted Trial Balance columns of the work sheet for the month ended September 30, prepare the closing entries for Perez Roofing Company.

Accepted Answer

The answer of On the basis of the following information...

Question 5

The proper sequence of steps in the accounting cycle is as follows

Accepted Answer

A)   analyze and record transactions, post transaction to the ledger, prepare a trial balance, prepare financial statements, journalize closing entries, analyze adjustment data and prepare adjusting entries
B)   prepare a trial balance, analyze adjustment data, prepare adjusting entries, prepare financial statements, journalize closing entries and post to the ledger, analyze and record transactions, post transactions to the ledger
C)   analyze and record transactions, post transactions to the ledger, prepare a trial balance, analyze adjustment data, prepare adjusting entries, prepare financial statements, journalize closing entries and post to the ledger
D)   prepare financial statements, journalize closing entries and post to the ledger, analyze and record transactions, post transactions to the ledger, prepare a trial balance, analyze adjustment data, prepare adjusting entriesE) All of the above
F) A) and C)

Question 6

Tracy Roberts, the sole stockholder of Surfer Dude Supplies, is requesting a $75,000 loan from the bank where you work as a loan officer. He brings to you the following trial balance (or statement of accounts) as of the end of his first year of operations.
What adjustments might be necessary before an accurate set of financial statements could be prepared?

Accepted Answer

The following adjustments migh...

Question 7

The most important output of the accounting cycle is the financial statements.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following accounts will not be closed to Income Summary at the end of the fiscal year?

Accepted Answer

A)   Salaries Expense
B)   Fees Earned
C)   Unearned Rent
D)   Depreciation ExpenseE) C) and D)
F) B) and C)

Question 9

The natural business year

Accepted Answer

A)   is a fiscal year that ends when business activities are at its lowest point.
B)   is a calendar year that ends when business activities are at its lowest point.
C)   is a fiscal year that ends when business activities are at its highest point.
D)   is a calendar year that ends when business activities are at its highest point.E) C) and D)
F) B) and C)

Question 10

Accrued taxes payable are generally reported on the balance sheet as a current liability.

Accepted Answer

A) True 
 B)False

Question 11

The income statement should be prepared

Accepted Answer

A)   before the retained earnings statement and balance sheet
B)   after the retained earnings statement and before the balance sheet
C)   after the retained earnings statement and balance sheet
D)   after the balance sheet and before the retained earnings statementE) B) and C)
F) All of the above

Question 12

After all of the account balances have been extended to the Balance Sheet columns of the work sheet, the totals of the debit and credit columns show debits of $37,686 and the credits of $41,101. This indicates that

Accepted Answer

A)   neither net income or loss can be calculated because it is found on the income statement.
B)   the company has a net loss of $3,415 for the period.
C)   the company has a net income of $3,415 for the period.
D)   the amounts are out of balance and need to be corrected.E) B) and D)
F) B) and C)

Question 13

On March 1, a company collects revenue in advance for the next twelve months and credits a liability account. The adjusting entry at year end on the work sheet would

Accepted Answer

A)   increase a liability account
B)   decrease an asset account
C)   decrease a revenue account
D)   decrease a liability accountE) A) and C)
F) A) and B)

Question 14

The accumulated depreciation account is closed to the income summary account.

Accepted Answer

A) True 
 B)False

Question 15

The closing process is sometimes referred to as closing the books.

Accepted Answer

A) True 
 B)False

Question 16

The post-closing trial balance differs from the adjusted trial balance in that it

Accepted Answer

A)   does not take into account closing entries
B)   does not take into account adjusting entries
C)   does not include balance sheet accounts
D)   does not include income statement accountsE) All of the above
F) B) and D)

Question 17

Entries required to close the balances of the temporary accounts at the end of the period are called final entries.

Accepted Answer

A) True 
 B)False

Question 18

The balance sheet accounts are referred to as real or permanent accounts.

Accepted Answer

A) True 
 B)False

Exam 4: Completing the Accounting Cycle

The accumulated depreciation account is closed to the income summary account.

Correct Answer
verified

Prepaid Insurance is an example of a current asset.

Correct Answer
verified

After all of the account balances have been extended to the Balance Sheet columns of the work sheet, the totals of the debit and credit columns show debits of $37,686 and the credits of $41,101. This indicates that

Correct Answer
verified

The income statement should be prepared

Correct Answer
verified

The post-closing trial balance differs from the adjusted trial balance in that it

Correct Answer
verified

On March 1, a company collects revenue in advance for the next twelve months and credits a liability account. The adjusting entry at year end on the work sheet would

Correct Answer
verified

Correct Answer
verified
The following adjustments migh...
View Answer

Accrued taxes payable are generally reported on the balance sheet as a current liability.

Correct Answer
verified

The proper sequence of steps in the accounting cycle is as follows

Correct Answer
verified

Accumulated depreciation appears on the

Correct Answer
verified

Which of the following accounts will not be closed to Income Summary at the end of the fiscal year?

Correct Answer
verified

The natural business year

Correct Answer
verified

The balance sheet accounts are referred to as real or permanent accounts.

Correct Answer
verified

The income summary account is also called

Correct Answer
verified

Entries required to close the balances of the temporary accounts at the end of the period are called final entries.

Correct Answer
verified

The most important output of the accounting cycle is the financial statements.

Correct Answer
verified

On the basis of the following information taken from the Adjusted Trial Balance columns of the work sheet for the month ended September 30, prepare the closing entries for Perez Roofing Company.

Correct Answer
verified

The closing process is sometimes referred to as closing the books.

Correct Answer
verified

Exam 4: Completing the Accounting Cycle

The accumulated depreciation account is closed to the income summary account.

Correct AnswerverifiedShow Answer

Prepaid Insurance is an example of a current asset.

Correct AnswerverifiedShow Answer

After all of the account balances have been extended to the Balance Sheet columns of the work sheet, the totals of the debit and credit columns show debits of $37,686 and the credits of $41,101. This indicates that

Correct AnswerverifiedShow Answer

The income statement should be prepared

Correct AnswerverifiedShow Answer

The post-closing trial balance differs from the adjusted trial balance in that it

Correct AnswerverifiedShow Answer

On March 1, a company collects revenue in advance for the next twelve months and credits a liability account. The adjusting entry at year end on the work sheet would

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe following adjustments migh...View AnswerShow Answer

Accrued taxes payable are generally reported on the balance sheet as a current liability.

Correct AnswerverifiedShow Answer

The proper sequence of steps in the accounting cycle is as follows

Correct AnswerverifiedShow Answer

Accumulated depreciation appears on the

Correct AnswerverifiedShow Answer

Which of the following accounts will not be closed to Income Summary at the end of the fiscal year?

Correct AnswerverifiedShow Answer

The natural business year

Correct AnswerverifiedShow Answer

The balance sheet accounts are referred to as real or permanent accounts.

Correct AnswerverifiedShow Answer

The income summary account is also called

Correct AnswerverifiedShow Answer

Entries required to close the balances of the temporary accounts at the end of the period are called final entries.

Correct AnswerverifiedShow Answer

The most important output of the accounting cycle is the financial statements.

Correct AnswerverifiedShow Answer

On the basis of the following information taken from the Adjusted Trial Balance columns of the work sheet for the month ended September 30, prepare the closing entries for Perez Roofing Company.

Correct AnswerverifiedShow Answer

The closing process is sometimes referred to as closing the books.

Correct AnswerverifiedShow Answer

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The following adjustments migh...
View Answer

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