Question 1

Revenue and expense accounts are permanent accounts and should not be closed at the end of the fiscal period.

Accepted Answer

A) True 
 B)False

Question 2

After all appropriate closing entries to the following accounts have been made, what will be the balance in the Jeff Corvette, Capital account? $$\begin{array} { | l | r | } 
\hline \text { Service fees revenue } & \$ 140,000 \
\hline \text { Various experses } & 60,000 \
\hline \text { Jeff Corvette, capital } & 80,000 \
\hline \text { Jeff Corvette, withdrawals } & 15,000 \
\hline
\end{array}$$

Accepted Answer

A)  $65,000 
B)  $80,000 
C)  $130,000 
D)  $145,000 
E)  $280,000 
A)  $65,000 
B)  $80,000 
C)  $130,000 
D)  $145,000 
E)  $280,000

Question 3

On the work sheet, profit is entered in the Income Statement Credit column and in the Statement of Changes in Equity or Balance Sheet Debit column.

Accepted Answer

A) True 
 B)False

Question 4

The current ratio is calculated by dividing current liabilities by current assets.

Accepted Answer

A) True 
 B)False

Question 5

The following are the steps in the accounting cycle. List them in the order in which they are completed: Completing the work sheet Posting Preparing an unadjusted trial balance Journalizing Preparing the statements Closing the temporary accounts Adjusting the ledger accounts Preparing a post-closing trial balance

Accepted Answer

(1) Journalizing
(2) Posting
(3) Prepari

Question 6

Explain why temporary accounts are closed each period.

Accepted Answer

Temporary accounts are closed at the end

Question 7

The withdrawals account is normally closed by debiting it.

Accepted Answer

A) True 
 B)False

Question 8

A post-closing trial balance is a list of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.

Accepted Answer

A) True 
 B)False

Question 9

Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense accounts, and the withdrawals account to a balance sheet equity account.

Accepted Answer

A) True 
 B)False

Question 10

On the work sheet, a loss is indicated if the total of the Income Statement Debit column exceeds the total of the Income Statement Credit column.

Accepted Answer

A) True 
 B)False

Question 11

Accounts that appear in the balance sheet are often called permanent or temporary accounts.

Accepted Answer

A) True 
 B)False

Question 12

Identify the steps in the accounting cycle.

Accepted Answer

The accounting cycle consists of ten ste

Question 13

A 10-column spreadsheet used to draft a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements, and which is an optional step in the accounting process, is a(n)

Accepted Answer

A)  Adjusted trial balance 
B)  Work sheet 
C)  Post-closing trial balance 
D)  Unadjusted trial balance 
E)  Book of final entry 
A)  Adjusted trial balance 
B)  Work sheet 
C)  Post-closing trial balance 
D)  Unadjusted trial balance 
E)  Book of final entry

Question 14

A company shows an $800 balance in Prepaid Insurance in the Unadjusted Trial Balance columns of the work sheet. The Adjustments columns show expired insurance of $600. This adjusting entry results in

Accepted Answer

A)  $600 less profit 
B)  $600 more profit 
C)  $200 difference between the debit and credit columns of the unadjusted trial balance 
D)  $400 in the Income Statement Debit column on the work sheet 
E)  $400 in the Balance Sheet Credit column on the work sheet 
A)  $600 less profit 
B)  $600 more profit 
C)  $200 difference between the debit and credit columns of the unadjusted trial balance 
D)  $400 in the Income Statement Debit column on the work sheet 
E)  $400 in the Balance Sheet Credit column on the work sheet

Question 15

Which of the following statements is incorrect?

Accepted Answer

A)  Permanent accounts are another name for temporary accounts. 
B)  Temporary accounts carry a zero balance at the beginning of each accounting period. 
C)  The Income Summary account is a temporary account. 
D)  Permanent accounts remain open as long as the asset, liability, or equity items recorded in the accounts continue in existence. 
E)  Permanent accounts include assets. 
A)  Permanent accounts are another name for temporary accounts. 
B)  Temporary accounts carry a zero balance at the beginning of each accounting period. 
C)  The Income Summary account is a temporary account. 
D)  Permanent accounts remain open as long as the asset, liability, or equity items recorded in the accounts continue in existence. 
E)  Permanent accounts include assets.

Question 16

Which of the following errors would cause the balance sheet columns of a work sheet to be out of balance?

Accepted Answer

A)  Entering an asset amount in the Income Statement Debit column. 
B)  Entering a liability amount in the Income Statement Credit column. 
C)  Entering an expense amount in the Balance Sheet Debit column. 
D)  Entering a revenue amount in the Balance Sheet Debit column. 
E)  Entering a liability amount in the Balance Sheet Credit column. 
A)  Entering an asset amount in the Income Statement Debit column. 
B)  Entering a liability amount in the Income Statement Credit column. 
C)  Entering an expense amount in the Balance Sheet Debit column. 
D)  Entering a revenue amount in the Balance Sheet Debit column. 
E)  Entering a liability amount in the Balance Sheet Credit column.

Question 17

Explain the purpose of reversing entries.

Accepted Answer

Reversing entries are an optional part o

Question 18

The work sheet is used to record transactions as they occur.

Accepted Answer

A) True 
 B)False

Question 19

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)  Income Summary account 
B)  Closing account 
C)  Balance column account 
D)  Contra account 
E)  Temporary account 
A)  Income Summary account 
B)  Closing account 
C)  Balance column account 
D)  Contra account 
E)  Temporary account

Question 20

Explain the purpose of closing entries and describe the closing process.

Accepted Answer

The purpose of closing entries is to tra

Revenue and expense accounts are permanent accounts and should not be closed at the end of the fiscal period.

After all appropriate closing entries to the following accounts have been made, what will be the balance in the Jeff Corvette, Capital account? Service fees revenue \ 140,000 Various experses 60,000 Jeff Corvette, capital 80,000 Jeff Corvette, withdrawals 15,000

On the work sheet, profit is entered in the Income Statement Credit column and in the Statement of Changes in Equity or Balance Sheet Debit column.

The current ratio is calculated by dividing current liabilities by current assets.

Explain why temporary accounts are closed each period.

The withdrawals account is normally closed by debiting it.

A post-closing trial balance is a list of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.

Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense accounts, and the withdrawals account to a balance sheet equity account.

On the work sheet, a loss is indicated if the total of the Income Statement Debit column exceeds the total of the Income Statement Credit column.

Accounts that appear in the balance sheet are often called permanent or temporary accounts.

Identify the steps in the accounting cycle.

A 10-column spreadsheet used to draft a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements, and which is an optional step in the accounting process, is a(n)

A company shows an $800 balance in Prepaid Insurance in the Unadjusted Trial Balance columns of the work sheet. The Adjustments columns show expired insurance of $600. This adjusting entry results in

Which of the following statements is incorrect?

Which of the following errors would cause the balance sheet columns of a work sheet to be out of balance?

Explain the purpose of reversing entries.

The work sheet is used to record transactions as they occur.

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

Explain the purpose of closing entries and describe the closing process.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Property, Plant and Equipment Intangibles

Payroll Liabilities

Accounting Information Systems

Filters

Exam 4: Completing the Accounting Cycle and Classifying Accounts

Revenue and expense accounts are permanent accounts and should not be closed at the end of the fiscal period.

After all appropriate closing entries to the following accounts have been made, what will be the balance in the Jeff Corvette, Capital account? Service fees revenue \ 140,000 Various experses 60,000 Jeff Corvette, capital 80,000 Jeff Corvette, withdrawals 15,000

On the work sheet, profit is entered in the Income Statement Credit column and in the Statement of Changes in Equity or Balance Sheet Debit column.

The current ratio is calculated by dividing current liabilities by current assets.

Explain why temporary accounts are closed each period.

The withdrawals account is normally closed by debiting it.

A post-closing trial balance is a list of permanent accounts and their balances from the ledger after all closing entries are journalized and posted.

Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense accounts, and the withdrawals account to a balance sheet equity account.

On the work sheet, a loss is indicated if the total of the Income Statement Debit column exceeds the total of the Income Statement Credit column.

Accounts that appear in the balance sheet are often called permanent or temporary accounts.

Identify the steps in the accounting cycle.

A 10-column spreadsheet used to draft a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements, and which is an optional step in the accounting process, is a(n)

A company shows an $800 balance in Prepaid Insurance in the Unadjusted Trial Balance columns of the work sheet. The Adjustments columns show expired insurance of $600. This adjusting entry results in

Which of the following statements is incorrect?

Which of the following errors would cause the balance sheet columns of a work sheet to be out of balance?

Explain the purpose of reversing entries.

The work sheet is used to record transactions as they occur.

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

Explain the purpose of closing entries and describe the closing process.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Property, Plant and Equipment Intangibles

Payroll Liabilities

Accounting Information Systems

Filters