Exam 4: Completing the Accounting Cycle

Which of the accounts below would not appear in the balance sheet columns of the end-of-period spreadsheet?

On the basis of the following data taken from the Adjusted Trial Balance columns of the work sheet for the year ended March 31 for Banes Domino's Corporation, journalize the four closing entries.

Net income is shown on the work sheet in the Income Statement debit column and the Balance Sheet credit column.

During the end-of-period processing, which of the following best describes the logical order of steps?

The unadjusted, adjusted, and final trial balances are prepared during the accounting cycle of a period.

The last step of the accounting cycle is to prepare a post-closing trial balance.

The post-closing trial balance will generally have fewer accounts than the trial balance.

Beachside Realty rents condominiums and furnishings. Below is the adjusted trial balance at December 31. Debit Credit Cash 1,500 Accounts Receivable 2,000 Interest Receivable 100 Prepaid Insurance 1,600 Notes Receivable long-term) 2,800 Equipment 15,000 Accumulated Depreciation 3,000 A.ccounts Payable 2,400 Accrued Expenses Payable 3,920 Income Taxes Payable 2,700 Unearned Rent Fees 500 Common Stock 5,000 Retained Earnings 2,700 Dividends 2,000 Rent Fees Earned 37,000 Furniture Rental Revenue 1,200 Interest Revenue 100 Wages Expense 19,000 Depreciation Expense 1,800 Utilities Expense 320 Insurance Expense 700 Maintenance Expense 9,000 Income Tax Expense 2,700 58,520 58,520 Prepare the entry required to close the revenue accounts at the end of the period.

The income statement columns in the end-of-period spreadsheet show that debits are equal to $55,800 and credits are $77,520. What does this information mean to the accountant?

The income summary account is also known as the clearing account.

You evaluate loan requests as part of your job at Eastwood National Bank. One loan request you received is from Surfer Dude Supplies, a small company. Richard Tracy, the CEO, is requesting $105,000 and brings you a trial balance or statement of accounts) for his first year of operations ended December 31. While you are willing to work with Richard, how would you explain to him that a complete set of financial statements from his accountant would be more useful for evaluating the loan request?

Which of the following accounts should be closed to Income Summary at the end of the fiscal year?

An indication that the end-of-period spreadsheet columns are in balance and the spreadsheet is complete is

After the account balances have been extended from the Adjusted Trial Balance columns on the work sheet, the difference between the initial totals of the Balance Sheet debit and credit columns is Net Income or Net Loss.

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

Closing entries

Match each journal entry that follows as one of the types of journal entries a-c) below. -Accounts Receivable 325 Fees Earned 325 Customer billed for services performed.)

The following revenue and expense account balances were taken from the Income Statement columns of the work sheet for Fraser Services Co. for December 31: Depreciation Expense \ 4,950 Insurance Expense 2,900 Miscellaneous Expense 1,200 Rent Expense 24,000 Service Revenue 92,500 Supplies Expense 3,150 Utilities Expense 5,000 Wages Expense 63,750 Prepare an income statement.

Which of the statements below indicates that a company earned a net income for the period?

After Net Income or Loss is entered on the work sheet, the debit column total must equal the credit column total for the Balance Sheet pair of columns.