Question 1

When the Income Statement Debit column total is greater than the Income Statement Credit column total on a work sheet, the business has a net income.

Accepted Answer

A) True 
 B)False  False

Question 2

Only accounts with a balance are listed in the Trial Balance columns of a work sheet.

Accepted Answer

A) True 
 B)False  False

Question 3

If an amount is written in an incorrect column of a work sheet, the error should be erased and the amount should be written in the correct column.

Accepted Answer

A) True 
 B)False  True

Question 4

Select the one term that best fits each definition.
-A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 5

Adjusting entries must be posted to the general ledger accounts.

Accepted Answer

A) True 
 B)False

Question 6

Select the one term that best fits each definition.
-A proof of the equality of debits and credits in a general ledger.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 7

Select the one term that best fits each definition.
-The difference between total revenue and total expenses when total expenses are greater.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 8

Select the one term that best fits each definition.
-Reporting income when the cash is received and expenses when the cash is paid.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 9

Select the one term that best fits each definition.
-Cash paid for an expense in one fiscal period that is not used until a later period.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 10

Select the one term that best fits each definition.
-The difference between total revenue and total expenses when total revenue is greater.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 11

Select the one term that best fits each definition.
-Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 12

Many businesses choose a one-year fiscal period that ends during a period of high business activity.

Accepted Answer

A) True 
 B)False

Question 13

The accounting concept Consistent Reporting is being applied when a word processing service business reports revenue per page one year and revenue per hour the next year.

Accepted Answer

A) True 
 B)False

Question 14

Select the one term that best fits each definition.
-A fiscal period consisting of 12 consecutive months.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 15

Select the one term that best fits each definition.
-A financial statement showing the revenue and expenses for a fiscal period.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 16

Select the one term that best fits each definition.
-A financial statement that reports the value of a business's assets, liabilities, and owner's equity on a specific date.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 17

Net income on a work sheet is calculated by subtracting the Income Statement Debit column total from the Income Statement Credit column total.

Accepted Answer

A) True 
 B)False

Question 18

Select the one term that best fits each definition.
-Reporting income when it is earned and expenses when they are incurred.

Accepted Answer

A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet 
A)  accrual basis of accounting 
B)  adjusting entries 
C)  adjustments 
D)  balance sheet 
E)  cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 19

If the Trial Balance columns are not equal and the difference can be evenly divided by 9, then the error most likely is a transposed number.

Accepted Answer

A) True 
 B)False

Question 20

Two financial statements are prepared from the information on the work sheet.

Accepted Answer

A) True 
 B)False

Exam 6: Work Sheet and Adjusting Entries

When the Income Statement Debit column total is greater than the Income Statement Credit column total on a work sheet, the business has a net income.

Only accounts with a balance are listed in the Trial Balance columns of a work sheet.

If an amount is written in an incorrect column of a work sheet, the error should be erased and the amount should be written in the correct column.

Select the one term that best fits each definition. -A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.

Adjusting entries must be posted to the general ledger accounts.

Select the one term that best fits each definition. -A proof of the equality of debits and credits in a general ledger.

Select the one term that best fits each definition. -The difference between total revenue and total expenses when total expenses are greater.

Select the one term that best fits each definition. -Reporting income when the cash is received and expenses when the cash is paid.

Select the one term that best fits each definition. -Cash paid for an expense in one fiscal period that is not used until a later period.

Select the one term that best fits each definition. -The difference between total revenue and total expenses when total revenue is greater.

Select the one term that best fits each definition. -Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period.

Many businesses choose a one-year fiscal period that ends during a period of high business activity.

The accounting concept Consistent Reporting is being applied when a word processing service business reports revenue per page one year and revenue per hour the next year.

Select the one term that best fits each definition. -A fiscal period consisting of 12 consecutive months.

Select the one term that best fits each definition. -A financial statement showing the revenue and expenses for a fiscal period.

Select the one term that best fits each definition. -A financial statement that reports the value of a business's assets, liabilities, and owner's equity on a specific date.

Net income on a work sheet is calculated by subtracting the Income Statement Debit column total from the Income Statement Credit column total.

Select the one term that best fits each definition. -Reporting income when it is earned and expenses when they are incurred.

If the Trial Balance columns are not equal and the difference can be evenly divided by 9, then the error most likely is a transposed number.

Two financial statements are prepared from the information on the work sheet.

The Accounting Equation

Debit and Credit Parts

Journalizing Transactions

Posting to a General Ledger

Cash Control Systems

Financial Statements for a Proprietorship

Closing Entries and Post-Closing

Accounting for Purchases and Cash Payments

Accounting for Sales and Cash Receipts

Using a General Journal

Preparing Payroll Records

Accounting for Payroll and Payroll Taxes

Uncollectible Accounts Receivable

Adjusting Entries and a Trial Balance

Financial Statements and Closing Entries

Financial Statement Analysis

Acquiring Capital for Growth and Development

Plant Assets and Intangible Assets

Accounting for Inventory

Accruals, Deferrals, and Reversing Entries

End-Of-Fiscal-Period Work for a Corporation

Accounting for Partnerships

Recording International and Internet Sales

Service Business Organized As a Proprietorship

Merchandising Business As a Corporation

Additional Accounting Procedures

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