Question 1

Current assets are listed in the order of liquidity.

Accepted Answer

A) True 
 B)False

Question 2

A correcting entry

Accepted Answer

A) must involve one balance sheet account and one income statement account. 
B) is another name for a closing entry. 
C) may involve any combination of accounts. 
D) is a required step in the accounting cycle. 
A) must involve one balance sheet account and one income statement account. 
B) is another name for a closing entry. 
C) may involve any combination of accounts. 
D) is a required step in the accounting cycle.

Question 3

Cash and supplies are both classified as current assets.

Accepted Answer

A) True 
 B)False

Question 4

Under IFRS

Accepted Answer

A) comparative prior-period information must be presented, but financial statements need not be provided annually. 
B) comparative prior-period informaton must be presented, and financial statements must be provided annually. 
C) comparative prior-period information is not required, and financial statements need not be provided annually. 
D) comparative prior-period information is not required, but financial statements must be provided annually. 
A) comparative prior-period information must be presented, but financial statements need not be provided annually. 
B) comparative prior-period informaton must be presented, and financial statements must be provided annually. 
C) comparative prior-period information is not required, and financial statements need not be provided annually. 
D) comparative prior-period information is not required, but financial statements must be provided annually.

Question 5

The following items are taken from the financial statements of the Postal Service for the year ending December 31, 2015:     What are total long-term liabilities at December 31, 2015?

Accepted Answer

A) $0 
B) $70,000 
C) $88,000 
D) $90,000 
A) $0 
B) $70,000 
C) $88,000 
D) $90,000

Question 6

The income statement for the month of June, 2015 of Camera Obscura Enterprises contains the following information:   The entry to close the expense accounts includes a

Accepted Answer

A) debit to Income Summary for $1,300. 
B) credit to Rent Expense for $1,500. 
C) credit to Income Summary for $5,700. 
D) debit to Salaries and Wages Expense for $3,000. 
A) debit to Income Summary for $1,300. 
B) credit to Rent Expense for $1,500. 
C) credit to Income Summary for $5,700. 
D) debit to Salaries and Wages Expense for $3,000.

Question 7

The steps in the preparation of a worksheet do not include

Accepted Answer

A) analyzing documentary evidence. 
B) preparing a trial balance on the worksheet. 
C) entering the adjustments in the adjustment columns. 
D) entering adjusted balances in the adjusted trial balance columns. 
A) analyzing documentary evidence. 
B) preparing a trial balance on the worksheet. 
C) entering the adjustments in the adjustment columns. 
D) entering adjusted balances in the adjusted trial balance columns.

Question 8

The use of fair value to report assets

Accepted Answer

A) is not allowed under GAAP or IFRS. 
B) is required by GAAP and IFRS. 
C) is increasing under GAAP and IFRS, but GAAP has adopted it more broadly. 
D) is increasing under GAAP and IFRS, but IFRS has adopted it more broadly. 
A) is not allowed under GAAP or IFRS. 
B) is required by GAAP and IFRS. 
C) is increasing under GAAP and IFRS, but GAAP has adopted it more broadly. 
D) is increasing under GAAP and IFRS, but IFRS has adopted it more broadly.

Question 9

After closing entries are posted, the balance in the retained earnings account in the ledger will be equal to

Accepted Answer

A) the beginning retained earnings reported on the retained earnings statement. 
B) the amount of the retained earnings reported on the balance sheet. 
C) zero. 
D) the net income for the period. 
A) the beginning retained earnings reported on the retained earnings statement. 
B) the amount of the retained earnings reported on the balance sheet. 
C) zero. 
D) the net income for the period.

Question 10

Adjusting entries are prepared from

Accepted Answer

A) source documents. 
B) the adjustments columns of the worksheet. 
C) the general ledger. 
D) last year's worksheet. 
A) source documents. 
B) the adjustments columns of the worksheet. 
C) the general ledger. 
D) last year's worksheet.

Question 11

Which of the following is a true statement about closing the books of a corporation?

Accepted Answer

A) Expenses are closed to the Expense Summary account. 
B) Only revenues are closed to the Income Summary account. 
C) Revenues and expenses are closed to the Income Summary account. 
D) Revenues, expenses, and the dividends account are closed to the Income Summary account. 
A) Expenses are closed to the Expense Summary account. 
B) Only revenues are closed to the Income Summary account. 
C) Revenues and expenses are closed to the Income Summary account. 
D) Revenues, expenses, and the dividends account are closed to the Income Summary account.

Question 12

A current asset is

Accepted Answer

A) the last asset purchased by a business. 
B) an asset which is currently being used to produce a product or service. 
C) usually found as a separate classification in the income statement. 
D) an asset that a company expects to convert to cash or use up within one year. 
A) the last asset purchased by a business. 
B) an asset which is currently being used to produce a product or service. 
C) usually found as a separate classification in the income statement. 
D) an asset that a company expects to convert to cash or use up within one year.

Question 13

If total credits in the income statement columns of a worksheet exceed total debits, the enterprise has net income.

Accepted Answer

A) True 
 B)False

Question 14

Each of the following accounts is closed to Income Summary except

Accepted Answer

A) Expenses. 
B) Dividends. 
C) Revenues. 
D) All of these are closed to Income Summary. 
A) Expenses. 
B) Dividends. 
C) Revenues. 
D) All of these are closed to Income Summary.

Question 15

A post-closing trial balance should be prepared

Accepted Answer

A) before closing entries are posted to the ledger accounts. 
B) after closing entries are posted to the ledger accounts. 
C) before adjusting entries are posted to the ledger accounts. 
D) only if an error in the accounts is detected. 
A) before closing entries are posted to the ledger accounts. 
B) after closing entries are posted to the ledger accounts. 
C) before adjusting entries are posted to the ledger accounts. 
D) only if an error in the accounts is detected.

Question 16

After closing entries have been journalized and posted, all temporary accounts in the ledger should have zero balances.

Accepted Answer

A) True 
 B)False

Question 17

Closing entries are necessary for

Accepted Answer

A) permanent accounts only. 
B) temporary accounts only. 
C) both permanent and temporary accounts. 
D) permanent or real accounts only. 
A) permanent accounts only. 
B) temporary accounts only. 
C) both permanent and temporary accounts. 
D) permanent or real accounts only.

Question 18

On May 25, Yellow House Company received a $650 check from Grizzly Bean for services to be performed in the future. The bookkeeper for Yellow House Company incorrectly debited Cash for $650 and credited Accounts Receivable for $650. The amounts have been posted to the ledger. To correct this entry, the bookkeeper should:

Accepted Answer

A) debit Cash $650 and credit Unearned Service Revenue $650. 
B) debit Accounts Receivable $650 and credit Service Revenue $650. 
C) debit Accounts Receivable $650 and credit Cash $650. 
D) debit Accounts Receivable $650 and credit Unearned Service Revenue $650. 
A) debit Cash $650 and credit Unearned Service Revenue $650. 
B) debit Accounts Receivable $650 and credit Service Revenue $650. 
C) debit Accounts Receivable $650 and credit Cash $650. 
D) debit Accounts Receivable $650 and credit Unearned Service Revenue $650.

Question 19

IFRS requires the use of

Accepted Answer

A) the term balance sheet. 
B) the term statement of financial position. 
C) neither balance sheet nor statement of financial position, but recommends use of the term balance sheet. 
D) neither balance sheet nor statement of financial position, but recommends use of the term statement of financial position. 
A) the term balance sheet. 
B) the term statement of financial position. 
C) neither balance sheet nor statement of financial position, but recommends use of the term balance sheet. 
D) neither balance sheet nor statement of financial position, but recommends use of the term statement of financial position.

Question 20

Correcting entries

Accepted Answer

A) always affect at least one balance sheet account and one income statement account. 
B) affect income statement accounts only. 
C) affect balance sheet accounts only. 
D) may involve any combination of accounts in need of correction. 
A) always affect at least one balance sheet account and one income statement account. 
B) affect income statement accounts only. 
C) affect balance sheet accounts only. 
D) may involve any combination of accounts in need of correction.

Current assets are listed in the order of liquidity.

A correcting entry

Cash and supplies are both classified as current assets.

Under IFRS

The following items are taken from the financial statements of the Postal Service for the year ending December 31, 2015: What are total long-term liabilities at December 31, 2015?

The income statement for the month of June, 2015 of Camera Obscura Enterprises contains the following information: The entry to close the expense accounts includes a

The steps in the preparation of a worksheet do not include

The use of fair value to report assets

After closing entries are posted, the balance in the retained earnings account in the ledger will be equal to

Adjusting entries are prepared from

Which of the following is a true statement about closing the books of a corporation?

A current asset is

If total credits in the income statement columns of a worksheet exceed total debits, the enterprise has net income.

Each of the following accounts is closed to Income Summary except

A post-closing trial balance should be prepared

After closing entries have been journalized and posted, all temporary accounts in the ledger should have zero balances.

Closing entries are necessary for

IFRS requires the use of

Correcting entries

Accounting in Action

The Recording Process

Adjusting the Accounts

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 4: Completing the Accounting Cycle

Current assets are listed in the order of liquidity.

A correcting entry

Cash and supplies are both classified as current assets.

Under IFRS

The following items are taken from the financial statements of the Postal Service for the year ending December 31, 2015: What are total long-term liabilities at December 31, 2015?

The income statement for the month of June, 2015 of Camera Obscura Enterprises contains the following information: The entry to close the expense accounts includes a

The steps in the preparation of a worksheet do not include

The use of fair value to report assets

After closing entries are posted, the balance in the retained earnings account in the ledger will be equal to

Adjusting entries are prepared from

Which of the following is a true statement about closing the books of a corporation?

A current asset is

If total credits in the income statement columns of a worksheet exceed total debits, the enterprise has net income.

Each of the following accounts is closed to Income Summary except

A post-closing trial balance should be prepared

After closing entries have been journalized and posted, all temporary accounts in the ledger should have zero balances.

Closing entries are necessary for

IFRS requires the use of

Correcting entries

Accounting in Action

The Recording Process

Adjusting the Accounts

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters