Exam 6: Financial Statements and the Closing Process

From the partial work sheet, prepare an income statement, a statement of owner's equity, and a classified balance sheet. The owner made no additional investments in the business during the month.

Match the terms with the definitions. -The process of giving zero balances to the temporary accounts so that they can accumulate information for the next accounting period.

Match the terms with the definitions. -Assets that are expected to serve the business for many years.

Which of the following steps of the accounting cycle are in the correct order?

Match the terms with the definitions. -Obligations that are not expected to be paid within a year and do not require the use of current assets.

Current assets include cash and other assets that will be converted into cash or consumed within one year or the normal operating cycle of the business, whichever is longer.

A form of balance sheet that lists the liabilities and the owner's equity sections below the assets section is called the

To close the drawing account with a debit balance, credit the account for its balance and debit the owner's capital account.

The Income Summary account is used to

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

The total revenue of the month of June amounted to $7,500; total expenses amounted to $3,500; and withdrawals amounted to $600. The net income for the month amounted to

Match the terms with the definitions. -A balance sheet in which the assets are on the left and the liabilities and the owner's equity sections are on the right.

To close an expense account with a debit balance, debit the account for its balance and credit the income summary account.

When recording closing entries in the general journal, which of the following is written in the Description column?

The journal entry to close expense accounts includes

A form of balance sheet that lists the assets at the left and the liabilities and owner's equity at the right is called a report form of balance sheet.

A post-closing trial balance is used to prove the equality of debit and credit balances in the general ledger accounts after the closing entries have been posted.

The account to which revenue and expenses are closed is called

Expenses on the income statement could be listed in the same order as they appear in the chart of accounts.

The balance in an expense account is closed to a(n)