Question 1

It is obvious that an error occurred in the preparation and/or posting of closing entries if:

Accepted Answer

A)  only permanent accounts appear on the post-closing trial balance.
B)  all balance sheet accounts have zero balances.
C)  the income summary account is debited for the amount of net income for the period.
D)  the owner's capital account is debited for the amount of the net loss for the period.
E)  all revenue and expense accounts have zero balances.F) B) and E)
G) A) and E)

Question 2

Use the information in the adjusted trial balance presented below to calculate the current ratio for Taron Company:   Account Title  Dr.  Cr.  Cash $23,000 Accounts receivable 16,000 Prepaid insurance 6,600 Equipment 100,000 Accumulated Depreciation-Equipment $50,000 Land 95,000 Accounts payable 17,000 Interest payable 2,400 Unearned revenue 5,000 Long-term notes payable 30,000 Z. Taron, Capital 136,200 Totals $240,600$240,600\begin{array}{|l|r|l|}\hline 	ext { Account Title } & 	ext { Dr. } & 	ext { Cr. } \\hline 	ext { Cash } & \$ 23,000 & \\hline 	ext { Accounts receivable } & 16,000 & \\hline 	ext { Prepaid insurance } & 6,600 & \\hline 	ext { Equipment } & 100,000 & \\hline 	ext { Accumulated Depreciation-Equipment } & & \$ 50,000 \\hline 	ext { Land } & 95,000 &\\hline 	ext { Accounts payable } & & 17,000 \\hline 	ext { Interest payable } & & 2,400 \\hline 	ext { Unearned revenue } & & 5,000 \\hline 	ext { Long-term notes payable } & & 30,000 \\hline 	ext { Z. Taron, Capital } & & 136,200 \\hline 	ext { Totals } & \$ 240,600 & \$ 240,600 \\hline\end{array} Account Title  Cash  Accounts receivable  Prepaid insurance  Equipment  Accumulated Depreciation-Equipment  Land  Accounts payable  Interest payable  Unearned revenue  Long-term notes payable  Z. Taron, Capital  Totals ​ Dr. $23,00016,0006,600100,00095,000$240,600​ Cr. $50,00017,0002,4005,00030,000136,200$240,600​​

Accepted Answer

A)  .54.
B)  1.77.
C)  1.87.
D)  3.92.
E)  1.60. F) C) and D)
G) C) and E)

Question 3

Jen Rogers withdrew a total of $35,000 from her business during the current year. The entry needed to close the withdrawals account is:

Accepted Answer

A)  Debit Jen Rogers, Withdrawals and credit Cash for $35,000.
B)  Debit Jen Rogers, Capital and credit Jen Rogers, Withdrawals for $35,000.
C)  Debit Jen Rogers, Withdrawals and credit Jen Rogers, Capital for $35,000.
D)  Debit Income Summary and credit Cash for $35,000.
E)  Debit Income Summary and credit Jen Rogers, Withdrawals for $35,000.F) A) and E)
G) A) and B)

Question 4

Closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period.

Accepted Answer

A) True 
 B)False

Question 5

Based on the following information from Schrute Company's balance sheet, calculate the current ratio.   Current assets $87,000 Investments 50,000 Plant assets 220,000 Current liabilities 39,000 Long-term liabilities 90,000 A. Schrute, Capital 228,000\begin{array} { | l | r | } \hline 	ext { Current assets } & \$ 87,000 \\hline 	ext { Investments } & 50,000 \\hline 	ext { Plant assets } & 220,000 \\hline 	ext { Current liabilities } & 39,000 \\hline 	ext { Long-term liabilities } & 90,000 \\hline 	ext { A. Schrute, Capital } & 228,000 \\hline\end{array} Current assets  Investments  Plant assets  Current liabilities  Long-term liabilities  A. Schrute, Capital ​$87,00050,000220,00039,00090,000228,000​​

Accepted Answer

A)  .44.
B)  2.23.
C)  1.06.
D)  3.51.
E)  3.33. F) D) and E)
G) C) and D)

Question 6

Temporary accounts include all of the following except:

Accepted Answer

A)  Prepaid rent.
B)  Consulting revenue.
C)  Rent expense.
D)  Income Summary.
E)  Withdrawals.F) B) and E)
G) A) and D)

Question 7

Which of the following accounts is a permanent (real) account?

Accepted Answer

A)  Interest revenue.
B)  Office supplies expense.
C)  Fees earned.
D)  Salaries expense.
E)  Accounts payable.F) All of the above
G) B) and E)

Question 8

For the year ended December 31, a company had revenues of $187,000 and expenses of $109,000. The owner withdrew $37,000 during the year. Which of the following entries could not be a closing entry?

Accepted Answer

A)  Debit Owner's Capital $37,000; credit Owner Withdrawals $37,000.
B)  Debit Income Summary $187,000; credit revenues $187,000.
C)  Debit revenues $187,000; credit Income Summary $187,000.
D)  Debit Income Summary $109,000, credit expenses $109,000.
E)  Debit Income Summary $78,000; credit Owner's, Capital $78,000.F) A) and B)
G) A) and C)

Question 9

Assets, liabilities, and equity accounts are not closed; these accounts are called:

Accepted Answer

A)  Temporary accounts.
B)  Contra accounts.
C)  Accrued accounts.
D)  Nominal accounts.
E)  Permanent accounts.F) C) and D)
G) B) and D)

Question 10

Match between columns
                        Premises: Statements that show the effects of proposed transactions as if the transactions had already occurred.
The time span from when cash is used to acquire goods and services until cash is received from the sale of those goods and services.
Entries used to transfer end-of-period balances in revenue, expense, and withdrawals accounts to the permanent owner's capital account.
Accounts that accumulate data related to one accounting period only; they include income statement accounts, withdrawals, and the Income Summary account.
Recurring steps in preparing financial statement performed each accounting period, beginning with analyzing transactions and ending with a post-closing trial balance or reversing entries.
Accounts that report on activities related to one or more future accounting periods; they carry their ending balances into the next period.
A widely used working paper that is a useful tool for preparers in working with accounting information, usually not available to external decision makers.
A list of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.
Various analyses and internal documents prepared by accountants when organizing information for internal and external decision makers.
A temporary account only used for the closing process that contains a credit for the sum of all revenues and a debit for the sum of all expenses.

Accepted Answer

The Answer of Closing entries and Operating cycle of a is...

Question 11

The balances in the unadjusted columns of a work sheet will agree with:

Accepted Answer

A)  whatever balances management has decided to report.
B)  the balances reflected in the company's unadjusted trial balance.
C)  the balances in the company's post-closing trial balance.
D)  the balances reflected in the company's financial statements.
E)  the balances management budgeted for the accounting period.F) A) and E)
G) B) and D)

Question 12

A company's post-closing trial balance has total debits of $40,560 and total credits of $40,650. Accordingly, the company should review for errors in the closing process.

Accepted Answer

A) True 
 B)False

Question 13

An optional columnar working paper used to prepare a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements is a(n) :

Accepted Answer

A)  Unadjusted trial balance.
B)  Adjusted trial balance.
C)  Work sheet.
D)  General ledger.
E)  Post-closing trial balance.F) C) and D)
G) D) and E)

Question 14

During the closing process, Owner's Capital is closed to the Owner's Withdrawals account.

Accepted Answer

A) True 
 B)False

Question 15

A work sheet contains all of the balances for each account and therefore may be used as a substitute for the set of financial statements.

Accepted Answer

A) True 
 B)False

Question 16

The Unadjusted Trial Balance columns of a company's work sheet shows the Store Supplies account with a balance of $750. The Adjustments columns shows a credit of $425 for supplies used during the period. The amount shown as Store Supplies in the Balance Sheet columns of the work sheet is:

Accepted Answer

A)  $425 debit.
B)  $750 debit.
C)  $425 credit.
D)  $325 credit.
E)  $325 debit.F) B) and E)
G) A) and E)

Question 17

The special account used only in the closing process to temporarily hold the amounts of revenues and expenses before the net difference is added to (or subtracted from) the owner's capital account is the:

Accepted Answer

A)  Contra account.
B)  Income Summary account.
C)  Nominal account.
D)  Closing account.
E)  Balance column account.F) C) and D)
G) A) and B)

Question 18

Income Summary is a temporary account only used for the closing process.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following accounts could not be classified as a current liability?

Accepted Answer

A)  Unearned revenues.
B)  Notes payable (due in 11 months) .
C)  Accounts payable.
D)  Current portion of long-term note payable.
E)  Notes payable (due in 5 years) .F) A) and C)
G) D) and E)

Question 20

What is the purpose of a post-closing trial balance?

Accepted Answer

A post-closing trial balance is a list o...

Exam 4: Completing the Accounting Cycle

Correct Answer
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It is obvious that an error occurred in the preparation and/or posting of closing entries if:

Correct Answer
verified

Jen Rogers withdrew a total of $35,000 from her business during the current year. The entry needed to close the withdrawals account is:

Correct Answer
verified

A work sheet contains all of the balances for each account and therefore may be used as a substitute for the set of financial statements.

Correct Answer
verified

What is the purpose of a post-closing trial balance?

Correct Answer
verified
A post-closing trial balance is a list o...
View Answer

Correct Answer
verified

The special account used only in the closing process to temporarily hold the amounts of revenues and expenses before the net difference is added to (or subtracted from) the owner's capital account is the:

Correct Answer
verified

Closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period.

Correct Answer
verified

A company's post-closing trial balance has total debits of $40,560 and total credits of $40,650. Accordingly, the company should review for errors in the closing process.

Correct Answer
verified

Match the appropriate definition with correct term

Assets, liabilities, and equity accounts are not closed; these accounts are called:

Correct Answer
verified

Which of the following accounts is a permanent (real) account?

Correct Answer
verified

Income Summary is a temporary account only used for the closing process.

Correct Answer
verified

The balances in the unadjusted columns of a work sheet will agree with:

Correct Answer
verified

Which of the following accounts could not be classified as a current liability?

Correct Answer
verified

For the year ended December 31, a company had revenues of $187,000 and expenses of $109,000. The owner withdrew $37,000 during the year. Which of the following entries could not be a closing entry?

Correct Answer
verified

Temporary accounts include all of the following except:

Correct Answer
verified

The Unadjusted Trial Balance columns of a company's work sheet shows the Store Supplies account with a balance of $750. The Adjustments columns shows a credit of $425 for supplies used during the period. The amount shown as Store Supplies in the Balance Sheet columns of the work sheet is:

Correct Answer
verified

During the closing process, Owner's Capital is closed to the Owner's Withdrawals account.

Correct Answer
verified

An optional columnar working paper used to prepare a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements is a(n) :

Correct Answer
verified

Exam 4: Completing the Accounting Cycle

Correct AnswerverifiedShow Answer

It is obvious that an error occurred in the preparation and/or posting of closing entries if:

Correct AnswerverifiedShow Answer

Jen Rogers withdrew a total of $35,000 from her business during the current year. The entry needed to close the withdrawals account is:

Correct AnswerverifiedShow Answer

A work sheet contains all of the balances for each account and therefore may be used as a substitute for the set of financial statements.

Correct AnswerverifiedShow Answer

What is the purpose of a post-closing trial balance?

Correct AnswerverifiedA post-closing trial balance is a list o...View AnswerShow Answer

Correct AnswerverifiedShow Answer

The special account used only in the closing process to temporarily hold the amounts of revenues and expenses before the net difference is added to (or subtracted from) the owner's capital account is the:

Correct AnswerverifiedShow Answer

Closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period.

Correct AnswerverifiedShow Answer

A company's post-closing trial balance has total debits of $40,560 and total credits of $40,650. Accordingly, the company should review for errors in the closing process.

Correct AnswerverifiedShow Answer

Match the appropriate definition with correct term

Assets, liabilities, and equity accounts are not closed; these accounts are called:

Correct AnswerverifiedShow Answer

Which of the following accounts is a permanent (real) account?

Correct AnswerverifiedShow Answer

Income Summary is a temporary account only used for the closing process.

Correct AnswerverifiedShow Answer

The balances in the unadjusted columns of a work sheet will agree with:

Correct AnswerverifiedShow Answer

Which of the following accounts could not be classified as a current liability?

Correct AnswerverifiedShow Answer

For the year ended December 31, a company had revenues of $187,000 and expenses of $109,000. The owner withdrew $37,000 during the year. Which of the following entries could not be a closing entry?

Correct AnswerverifiedShow Answer

Temporary accounts include all of the following except:

Correct AnswerverifiedShow Answer

The Unadjusted Trial Balance columns of a company's work sheet shows the Store Supplies account with a balance of $750. The Adjustments columns shows a credit of $425 for supplies used during the period. The amount shown as Store Supplies in the Balance Sheet columns of the work sheet is:

Correct AnswerverifiedShow Answer

During the closing process, Owner's Capital is closed to the Owner's Withdrawals account.

Correct AnswerverifiedShow Answer

An optional columnar working paper used to prepare a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements is a(n) :

Correct AnswerverifiedShow Answer

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A post-closing trial balance is a list o...
View Answer

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