Question 1

The purpose and use of the income summary account is to summarize the difference between revenues and expenses.

Accepted Answer

A) True 
 B)False

Question 2

The steps involved in handling all of the transactions and events completed during an accounting period, beginning with placing data in a book of original entry and ending with a post-closing trial balance, are referred to collectively as

Accepted Answer

A)  input. 
B)  processing. 
C)  output. 
D)  the accounting cycle. 
A)  input. 
B)  processing. 
C)  output. 
D)  the accounting cycle.

Question 3

A balance sheet that classifies (or groups) items by similarities is called a unified balance sheet.

Accepted Answer

A) True 
 B)False

Question 4

A mortgage on an office building is an example of a property, plant, and equipment asset.

Accepted Answer

A) True 
 B)False

Question 5

(Appendix) Equipment costing $12,000 was purchased for cash. This activity is classified as

Accepted Answer

A)  operating. 
B)  investing. 
C)  financing. 
D)  borrowing. 
A)  operating. 
B)  investing. 
C)  financing. 
D)  borrowing.

Question 6

The income summary account appears on the income statement at the end of the accounting period.

Accepted Answer

A) True 
 B)False

Question 7

Assets, liabilities, and the owner's capital account are permanent accounts.

Accepted Answer

A) True 
 B)False

Question 8

Property, plant, and equipment are assets that are expected to serve the business for many years.

Accepted Answer

A) True 
 B)False

Question 9

Match the terms with the definitions.
-The period of time required to purchase supplies and services and convert them back into cash.

Accepted Answer

A) account form of balance sheet 
B) accounting cycle 
C) classified balance sheet 
D) closing process 
E) current assets
F)current liabilities
G)Income Summary
H)long-term liabilities
I)operating cycle
J)permanent accounts
K)post-closing trial balance
L)property, plant, and equipment
M)report form of balance sheet
N)temporary accounts 
A) account form of balance sheet 
B) accounting cycle 
C) classified balance sheet 
D) closing process 
E) current assets
F)current liabilities
G)Income Summary
H)long-term liabilities
I)operating cycle
J)permanent accounts
K)post-closing trial balance
L)property, plant, and equipment
M)report form of balance sheet
N)temporary accounts

Question 10

Which step is taken at the end of the accounting period?

Accepted Answer

A)  analyze source documents 
B)  post to the general ledger accounts 
C)  prepare a trial balance 
D)  prepare a post-closing trial balance 
A)  analyze source documents 
B)  post to the general ledger accounts 
C)  prepare a trial balance 
D)  prepare a post-closing trial balance

Question 11

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.

Accepted Answer

A) True 
 B)False

Question 12

(Appendix) Business transactions can be classified as

Accepted Answer

A)  operating, investing, and accounting. 
B)  operating, financing, and lending. 
C)  operating, investing, and financing. 
D)  operating, lending, and borrowing. 
A)  operating, investing, and accounting. 
B)  operating, financing, and lending. 
C)  operating, investing, and financing. 
D)  operating, lending, and borrowing.

Question 13

The effect of drawing transactions on the capital account is formalized at any time during the accounting period.

Accepted Answer

A) True 
 B)False

Question 14

Current liabilities are liabilities that are due within one year.

Accepted Answer

A) True 
 B)False

Question 15

Match the terms with the definitions.
-A balance sheet with separate categories for current assets; property, plant, and equipment; current liabilities; and long-term liabilities.

Accepted Answer

A) account form of balance sheet 
B) accounting cycle 
C) classified balance sheet 
D) closing process 
E) current assets
F)current liabilities
G)Income Summary
H)long-term liabilities
I)operating cycle
J)permanent accounts
K)post-closing trial balance
L)property, plant, and equipment
M)report form of balance sheet
N)temporary accounts 
A) account form of balance sheet 
B) accounting cycle 
C) classified balance sheet 
D) closing process 
E) current assets
F)current liabilities
G)Income Summary
H)long-term liabilities
I)operating cycle
J)permanent accounts
K)post-closing trial balance
L)property, plant, and equipment
M)report form of balance sheet
N)temporary accounts

Question 16

A form of balance sheet that shows the liabilities and owner's equity sections below the assets section is called an account form of balance sheet.

Accepted Answer

A) True 
 B)False

Question 17

Long-term liabilities may also be called long-term debt.

Accepted Answer

A) True 
 B)False

Question 18

The amounts in the financial statements must agree with the ledger account balances.

Accepted Answer

A) True 
 B)False

Question 19

An income statement is an itemized statement for the purpose of providing information regarding the results of operations during a specified period of time.

Accepted Answer

A) True 
 B)False

Question 20

The order in which financial statements should be prepared is

Accepted Answer

A)  balance sheet, income statement, statement of owner's equity. 
B)  income statement, balance sheet, statement of owner's equity. 
C)  statement of owner's equity, balance sheet, income statement. 
D)  income statement, statement of owner's equity, balance sheet. 
A)  balance sheet, income statement, statement of owner's equity. 
B)  income statement, balance sheet, statement of owner's equity. 
C)  statement of owner's equity, balance sheet, income statement. 
D)  income statement, statement of owner's equity, balance sheet.

The purpose and use of the income summary account is to summarize the difference between revenues and expenses.

The steps involved in handling all of the transactions and events completed during an accounting period, beginning with placing data in a book of original entry and ending with a post-closing trial balance, are referred to collectively as

A balance sheet that classifies (or groups) items by similarities is called a unified balance sheet.

A mortgage on an office building is an example of a property, plant, and equipment asset.

(Appendix) Equipment costing $12,000 was purchased for cash. This activity is classified as

The income summary account appears on the income statement at the end of the accounting period.

Assets, liabilities, and the owner's capital account are permanent accounts.

Property, plant, and equipment are assets that are expected to serve the business for many years.

Match the terms with the definitions. -The period of time required to purchase supplies and services and convert them back into cash.

Which step is taken at the end of the accounting period?

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.

(Appendix) Business transactions can be classified as

The effect of drawing transactions on the capital account is formalized at any time during the accounting period.

Current liabilities are liabilities that are due within one year.

Match the terms with the definitions. -A balance sheet with separate categories for current assets; property, plant, and equipment; current liabilities; and long-term liabilities.

A form of balance sheet that shows the liabilities and owner's equity sections below the assets section is called an account form of balance sheet.

Long-term liabilities may also be called long-term debt.

The amounts in the financial statements must agree with the ledger account balances.

An income statement is an itemized statement for the purpose of providing information regarding the results of operations during a specified period of time.

The order in which financial statements should be prepared is

Introduction to Accounting

Analyzing Transactions: the Accounting Equation

The Double-Entry Framework

Journalizing and Posting Transactions

Adjusting Entries and the Work Sheet

Accounting for Cash

Payroll Accounting: Employer Taxes and Reports

Accounting for Sales and Cash Receipts

Accounting for Purchases and Cash Payments

Special Journals

Accounting for Merchandise Inventory

Adjustments and the Work Sheet for a Merchandising Business

Financial Statements and Year-End Accounting for a Merchandising Business

Accounting for a Professional Service Business: The Combination Journal

Filters

Exam 6: Financial Statements and the Closing Process

The purpose and use of the income summary account is to summarize the difference between revenues and expenses.

The steps involved in handling all of the transactions and events completed during an accounting period, beginning with placing data in a book of original entry and ending with a post-closing trial balance, are referred to collectively as

A balance sheet that classifies (or groups) items by similarities is called a unified balance sheet.

A mortgage on an office building is an example of a property, plant, and equipment asset.

(Appendix) Equipment costing $12,000 was purchased for cash. This activity is classified as

The income summary account appears on the income statement at the end of the accounting period.

Assets, liabilities, and the owner's capital account are permanent accounts.

Property, plant, and equipment are assets that are expected to serve the business for many years.

Match the terms with the definitions. -The period of time required to purchase supplies and services and convert them back into cash.

Which step is taken at the end of the accounting period?

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.

(Appendix) Business transactions can be classified as

The effect of drawing transactions on the capital account is formalized at any time during the accounting period.

Current liabilities are liabilities that are due within one year.

Match the terms with the definitions. -A balance sheet with separate categories for current assets; property, plant, and equipment; current liabilities; and long-term liabilities.

A form of balance sheet that shows the liabilities and owner's equity sections below the assets section is called an account form of balance sheet.

Long-term liabilities may also be called long-term debt.

The amounts in the financial statements must agree with the ledger account balances.

An income statement is an itemized statement for the purpose of providing information regarding the results of operations during a specified period of time.

The order in which financial statements should be prepared is

Introduction to Accounting

Analyzing Transactions: the Accounting Equation

The Double-Entry Framework

Journalizing and Posting Transactions

Adjusting Entries and the Work Sheet

Accounting for Cash

Payroll Accounting: Employer Taxes and Reports

Accounting for Sales and Cash Receipts

Accounting for Purchases and Cash Payments

Special Journals

Accounting for Merchandise Inventory

Adjustments and the Work Sheet for a Merchandising Business

Financial Statements and Year-End Accounting for a Merchandising Business

Accounting for a Professional Service Business: The Combination Journal

Filters