Question 1

Which of the following assets is the MOST liquid?

Accepted Answer

A) Prepaid expenses 
B) Cash 
C) Accounts receivable 
D) Inventory 
A) Prepaid expenses 
B) Cash 
C) Accounts receivable 
D) Inventory

Question 2

Prepaid rent is usually a non- current asset.

Accepted Answer

A) True 
 B)False

Question 3

Where can closing entries be found?

Accepted Answer

A) On a company's balance sheet 
B) In a company's general journal 
C) On a company's worksheet 
D) On a company's statement of changes in equity 
A) On a company's balance sheet 
B) In a company's general journal 
C) On a company's worksheet 
D) On a company's statement of changes in equity

Question 4

Which of the following is NOT a non- current asset?

Accepted Answer

A) Accounts receivable 
B) Land 
C) Equipment 
D) Buildings 
A) Accounts receivable 
B) Land 
C) Equipment 
D) Buildings

Question 5

What is the key distinction between current and non- current assets?

Accepted Answer

A) Current assets will be used up or converted to cash within one year or one operating cycle. 
B) Non- current assets will not be used until the future. 
C) Non- current assets are assets which do not lose their value over time. 
D) Current assets always have lower balances than non- current assets. 
A) Current assets will be used up or converted to cash within one year or one operating cycle. 
B) Non- current assets will not be used until the future. 
C) Non- current assets are assets which do not lose their value over time. 
D) Current assets always have lower balances than non- current assets.

Question 6

The adjusted balance in the service revenue account is copied to the credit column of the Income statement worksheet.

Accepted Answer

A) True 
 B)False

Question 7

Prepaid rent in the worksheet's trial balance column is $4 000. Prepaid rent in the balance sheet column is $2 000. Which of the following entries would have caused this difference?

Accepted Answer

A) A $2 000 credit entry to Prepaid rent in the worksheet's adjustments column 
B) A $2 000 debit entry to Cash in the worksheet's adjustments column 
C) A $2 000 debit entry to Prepaid rent in the worksheet's adjustments column 
D) A $2 000 credit entry to Rent expense in the worksheet's adjustments column 
A) A $2 000 credit entry to Prepaid rent in the worksheet's adjustments column 
B) A $2 000 debit entry to Cash in the worksheet's adjustments column 
C) A $2 000 debit entry to Prepaid rent in the worksheet's adjustments column 
D) A $2 000 credit entry to Rent expense in the worksheet's adjustments column

Question 8

Permanent accounts are NOT closed at the end of the period.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is TRUE if the Income statement debit column exceeds the Income statement credit column on a worksheet?

Accepted Answer

A) The capital account increased during the period. 
B) Liabilities are greater than assets. 
C) The company has a profit. 
D) The company has a loss. 
A) The capital account increased during the period. 
B) Liabilities are greater than assets. 
C) The company has a profit. 
D) The company has a loss.

Question 10

The adjusting entry for depreciation would include a:

Accepted Answer

A) debit to Accumulated depreciation and a credit to Depreciation expense. 
B) debit to Depreciation expense and a credit to Cash. 
C) debit to Accumulated depreciation and a credit to the asset. 
D) debit to Depreciation expense and a credit to Accumulated depreciation. 
A) debit to Accumulated depreciation and a credit to Depreciation expense. 
B) debit to Depreciation expense and a credit to Cash. 
C) debit to Accumulated depreciation and a credit to the asset. 
D) debit to Depreciation expense and a credit to Accumulated depreciation.

Question 11

Please refer to the worksheet below. Enter the following adjusting entry into the worksheet:
At year- end, the company records $240 of depreciation expense.

Accepted Answer

The answer of Please refer to the worksheet below. Enter...

Question 12

Please refer to the partially completed worksheet below:   How much was the Profit?

Accepted Answer

A) $13 600 
B) $28 400 
C) $22 020 
D) $42 000 
A) $13 600 
B) $28 400 
C) $22 020 
D) $42 000

Question 13

Beginning balance in Capital is $80 000. Revenues are $60 000. Expenses are $75 000. No drawings were taken. The ending balance in Capital is $95 000.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is the measure of how quickly an item can be converted to cash?

Accepted Answer

A) Current ratio 
B) Debt ratio 
C) Accounting cycle 
D) Liquidity 
A) Current ratio 
B) Debt ratio 
C) Accounting cycle 
D) Liquidity

Question 15

Which of the following statements MOST precisely describes a classified balance sheet?

Accepted Answer

A) Assets are listed in order of decreasing liquidity. 
B) Account balances are listed from the highest amount to the lowest amount. 
C) Assets are listed in alphabetical order. 
D) Assets are listed in their order of liquidity. 
A) Assets are listed in order of decreasing liquidity. 
B) Account balances are listed from the highest amount to the lowest amount. 
C) Assets are listed in alphabetical order. 
D) Assets are listed in their order of liquidity.

Question 16

The last step in the closing process is to credit the Drawings account and debit the Capital account.

Accepted Answer

A) True 
 B)False

Question 17

What is the key distinction between current and non- current liabilities?

Accepted Answer

A) Non- current liabilities are permanent debts of the business. 
B) Non- current liabilities always increase over time. 
C) Current liabilities always have lower balances than non- current liabilities. 
D) Current liabilities will be paid off within one year or one operating cycle. 
A) Non- current liabilities are permanent debts of the business. 
B) Non- current liabilities always increase over time. 
C) Current liabilities always have lower balances than non- current liabilities. 
D) Current liabilities will be paid off within one year or one operating cycle.

Question 18

Which of the following would be considered a non- current asset?

Accepted Answer

A) Accounts receivable 
B) Inventory 
C) Prepaid insurance 
D) Land 
A) Accounts receivable 
B) Inventory 
C) Prepaid insurance 
D) Land

Exam 4: Completing the Accounting Cycle

Which of the following assets is the MOST liquid?

Prepaid rent is usually a non- current asset.

Where can closing entries be found?

Which of the following is NOT a non- current asset?

What is the key distinction between current and non- current assets?

The adjusted balance in the service revenue account is copied to the credit column of the Income statement worksheet.

Prepaid rent in the worksheet's trial balance column is $4 000. Prepaid rent in the balance sheet column is $2 000. Which of the following entries would have caused this difference?

Permanent accounts are NOT closed at the end of the period.

Which of the following is TRUE if the Income statement debit column exceeds the Income statement credit column on a worksheet?

The adjusting entry for depreciation would include a:

Please refer to the worksheet below. Enter the following adjusting entry into the worksheet: At year- end, the company records $240 of depreciation expense.

Please refer to the partially completed worksheet below: How much was the Profit?

Beginning balance in Capital is $80 000. Revenues are $60 000. Expenses are $75 000. No drawings were taken. The ending balance in Capital is $95 000.

Which of the following is the measure of how quickly an item can be converted to cash?

Which of the following statements MOST precisely describes a classified balance sheet?

The last step in the closing process is to credit the Drawings account and debit the Capital account.

What is the key distinction between current and non- current liabilities?

Which of the following would be considered a non- current asset?

The Role of Accounting in Business

Recording Business Transactions

The Adjusting Process

Retailing Operations

Retail Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Non-Current Assets: Property, Plant and Equipment, and Intangibles

Current Liabilities and Payroll

Non-Current Liabilities, Debentures Payable and Classification of Liabilities on the Balance Sheet

Partnerships

Companies: Share Capital and the Balance Sheet

Companies: Effects on Retained Earnings, Share Splits and Buy-Backs, and the Income Statement

The Cash Flow Statement

The Framework of Accounting

Financial Statement Analysis

Introduction to Managerial Accounting and the Master Budget

Job Costing

Short-Term Business Decisions

Capital Investment Decisions and the Time Value of Money

Appendix

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