Exam 4: Completion of the Accounting Cycle

The unadjusted trial balance columns of the work sheet show the balance in the Prepaid Insurance account at $2,250. The adjustments columns show that $625 of this insurance was used during the period. Assuming there is no other charges to insurance expense during the year, what amount would be shown as Insurance Expense in the income statement columns?

Keswick Industries has the following current assets and current liabilities on the company's balance sheet: Cash $17,000; Accounts Receivable $8,200; Inventory $54,000; Prepaid Rent $3,000; Accounts Payable $23,000; Long-Term Notes Payable $20,000; and Unearned Revenue $5,500. The company's acid-test ratio would be

The owner's drawings account is closed to the Income Summary account in order to properly determine profit (or loss) for the period.

Although it may look unusual, when preparing a reversing entry you may create

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

The balance in the Owner's Drawings account after all closing entries have been posted will be equal to

Which of the following is the final step in the accounting cycle?

For entity's reporting under International Financial Reporting Standards, "non- current assets" is typically presented on the Balance Sheet

The current ratio is the ratio of current liabilities divided by current assets.

Assets, liabilities, and equity accounts are considered

The adjustments on a work sheet can be posted directly to the accounts in the ledger from the work sheet.

The work sheet does NOT show

The account, Supplies, will appear in the debit columns of the work sheet for all columns EXCEPT the

The accounting cycle begins at the start of a new accounting period.

A post-closing trial balance will show

The current ratio is expressed as

Which of the following depicts the proper sequence of steps in the accounting cycle?

Another name for Balance Sheet is the Statement of Financial Position.

Which of the following steps in the accounting cycle would NOT generally be performed daily?

The last three steps in the accounting cycle include prepare financial statements, journalize and post closing entries, and prepare a post-closing trial balance.