Exam 4: Completing the Accounting Cycle

The recurring steps performed each reporting period in preparing financial statements, starting with analyzing and recording transactions in the journal and continuing through the post-closing trial balance, is referred to as the:

The withdrawals account is normally closed by debiting it.

The current ratio is computed by dividing current liabilities by current assets.

Plant assets are usually listed in order from most liquid to least liquid.

Which of the following accounts showing a balance on the post-closing trial balance indicate an error?

Which of the following types of businesses might have an operating cycle longer than one year?

The current ratio is used to help assess a company's ability to pay its debts in the near future.

The work sheet is a required report made available to external decision makers.

Adjusting entries are usually entered in the work sheet before they are entered in the general journal.

An expense account is normally closed by debiting Income Summary and crediting the expense account.

Which of the following statements about a company's operating cycle is not true:

Accumulated Depreciation and Service Fees Earned would be sorted to which respective columns in completing a work sheet?

The Unadjusted Trial Balance columns of a work sheet total $84,000. The Adjustments columns contain entries for the following: Office supplies used during the period, $1,200. Expiration of prepaid rent, $700. Accrued salaries expense, $500. Depreciation expense, $800. Accrued service fees receivable, $400. The Adjusted Trial Balance columns total is:

A classified balance sheet:

Reversing entries overcome the disadvantage of more complex entries to pay accrued liabilities from the previous accounting period.

When closing entries are made:

How is a classified balance sheet different from an unclassified balance sheet? List the usual order of the categories on a classified balance sheet.

After preparing and posting the closing entries for revenues and expenses, the income summary account has a debit balance of $33,000. The entry to close the income summary account will be:

The following information is available for the Noir Detective Agency. After closing entries are posted, what will be the balance in the G. Noir, Capital account? Net Loss \ 17,600 G. Noir, Capital 289,000 G. Noir, Withdrawals 32,000

If a company has current assets of $15,000 and current liabilities of $9,500, its current ratio is 1.6