Exam 4: Completing the Accounting Cycle

As part of the closing process, revenues and expenses are closed to a temporary account called Profit (loss).

Which account has a balance equal to profit immediately before it is closed?

In which of the columns of the worksheet would Profit be found?

The post- closing trial balance is an optional step.

Which of the following accounts would appear in the Income statement credit column?

The adjusting process zeroes out all revenues and all expenses.

Revenues total $10 200. Expenses total $7 300. Drawings total $2 600. What is the balance in the Income summary account after closing profit or loss to the Capital account?

Which of the following is a current asset that is expected to be converted to cash, sold, or consumed during the next year (or the normal operating cycle, if longer)?

Assets and liabilities are classified as either current or non- current to show their relative liquidity.

The post- closing trial balance shows the profit for the period just ended.

The current ratio and the debt ratio are shown on the Income statement.

Beginning balance in Capital is $10 000. Revenues are $200 000. Expenses are $120 000. Drawings are $4 000. The ending balance in Capital is $86 000.

Accounts payable is a temporary account.

Which of the following accounts will still show a balance after the closing process is completed?

The Drawings account is copied to the Income statement columns on the worksheet.

The post- closing trial balance shows the updated Capital balance.

The post- closing trial balance lists the accounts from the general ledger in:

To what account is the balance in the Income summary account closed?

The last two columns generally found on the right side of the worksheet are the Income statement columns.

Which of the following does the debt ratio measure?