Question 1

How is Income Summary closed if the company had a net loss?

Accepted Answer

A) Credit Income Summary; debit Capital 
B) Debit Income Summary; credit Capital 
C) Debit Capital; credit Withdrawals 
D) Debit Withdrawals; credit Capital 
A) Credit Income Summary; debit Capital 
B) Debit Income Summary; credit Capital 
C) Debit Capital; credit Withdrawals 
D) Debit Withdrawals; credit Capital

Question 2

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement on which the account balance is reported, and in Column 4 the account's nature (permanent/temporary).
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column 1 } & \text { Column } 2 & \text { Column } 3 & \text { Column } 4 \
\hline \text { Accounts } & & & & \
 \text { Receivable } & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 3

The ending merchandise inventory was overstated.This error would cause:

Accepted Answer

A) net income to be understated. 
B) assets to be understated. 
C) net income to be overstated. 
D) expense to be overstated. 
A) net income to be understated. 
B) assets to be understated. 
C) net income to be overstated. 
D) expense to be overstated.

Question 4

The reversing entry for Salaries is:

Accepted Answer

A) debit Salaries Expense; credit Salaries Payable. 
B) debit Salaries Payable; credit Income Summary. 
C) debit Salaries Payable; credit Salaries Expense. 
D) debit Salaries Expense; credit Cash. 
A) debit Salaries Expense; credit Salaries Payable. 
B) debit Salaries Payable; credit Income Summary. 
C) debit Salaries Payable; credit Salaries Expense. 
D) debit Salaries Expense; credit Cash.

Question 5

Prepare closing entries from the following information on the Warner Books worksheet income statement columns.Additional information: Withdrawals equal $20 for the period.
 $\quad $$\quad $$\quad $$\quad $$\quad $$\quad $$\quad $$\quad $$\quad $$\quad $$\quad $$\text { Income Statement }$
$\begin{array}{lll}
& \text { Debit } & \text { Credit } \
\text { Sales } &&90\
\text { Sales Ret. and Allow. } & 8 &\
\text { Income Summary } & 16 &22 \
\text { Purchases } & 50 &  \
\text { Pur. Ret, and Allow. } & & 8 \
\text { Sales Salaries Expense } & 12 & \
\text { Office Salaries Expense } & 4 &
\end{array}$

Accepted Answer

The answer of Prepare closing entries from the following information...

Question 6

Determine the beginning inventory of a business having:
Beginning Capital balance of $11,000
No additional investments or withdrawals
Net sales of $43,500
Net purchases $26,000
Ending inventory of $4,250
Ending Capital balance of $10,000
Operating expenses of $16,500
$ ________

Accepted Answer

The answer of Determine the beginning inventory of a business...

Question 7

Determine the ending inventory of a business having:
Beginning Capital $6,000
Net sales of $50,000
Net purchases of $30,500
Freight-in of $2,000
Beginning inventory of $4,000
Ending Capital of $10,000
Operating expenses of $14,000
$ ________

Accepted Answer

The answer of Determine the ending inventory of a business...

Question 8

A company paid next month's rent in advance.This would be classified as a(n):

Accepted Answer

A) current asset. 
B) Expense. 
C) Revenue. 
D) current liability. 
A) current asset. 
B) Expense. 
C) Revenue. 
D) current liability.

Question 9

Net Purchases + Purchases Returns and Allowances + Purchase Discount equals:

Accepted Answer

A) Net Loss. 
B) Net Income. 
C) Gross Profit. 
D) Gross Purchases. 
A) Net Loss. 
B) Net Income. 
C) Gross Profit. 
D) Gross Purchases.

Question 10

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement on which the account balance is reported, and in Column 4 the account's nature (permanent/temporary).
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column 1 } & \text { Column } 2 & \text { Column } 3 & \text { Column } 4 \
\hline \begin{array} { l } 
\text { Merchandise } \
\text { Inventory }
\end{array} & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 11

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement on which the account balance is reported, and in Column 4 the account's nature (permanent/temporary).
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column } 1 & \text { Column } 2 & \text { Column } 3 & \text { Column } 4 \
\hline \text { Prepaid } & & & & \
\text { Insurance } & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 12

In closing entries,the Income Summary account is closed to the Capital account after Withdrawals.

Accepted Answer

A) True 
 B)False

Question 13

Discuss the purpose of a detailed income statement.Briefly describe the major kinds of business activities covered on a detailed income statement.

Accepted Answer

A detailed income statement provides inf

Question 14

Closing entries:

Accepted Answer

A) are posted to the general ledger. 
B) are done to update Cash. 
C) can be done before adjusting entries. 
D) All of the above are correct. 
A) are posted to the general ledger. 
B) are done to update Cash. 
C) can be done before adjusting entries. 
D) All of the above are correct.

Question 15

For each of the following, identify in Column 1 the category to which the account belongs, in Column 2 the normal balance for the account, in Column 3 the financial statement on which the account balance is reported, and in Column 4 the account's nature (permanent/temporary).
-$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Column } 1 & \text { Column } 2 & \text { Column } 3 & \text { Column } 4 \
\hline \text { Purchases } & & & & \
\text { Discounts } & & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 16

Which of the following accounts will appear on the post-closing trial balance?

Accepted Answer

A) Capital 
B) Purchases 
C) Sales 
D) Withdrawals 
A) Capital 
B) Purchases 
C) Sales 
D) Withdrawals

Question 17

The entry to close the Withdrawal account was entered in reverse-the Withdrawal account was debited and Capital credited.This error would cause:

Accepted Answer

A) Capital to be understated. 
B) net income to be overstated. 
C) net income to be understated. 
D) Withdrawals to be overstated. 
A) Capital to be understated. 
B) net income to be overstated. 
C) net income to be understated. 
D) Withdrawals to be overstated.

Question 18

Gross profit minus Operating Expenses equals Net Income.

Accepted Answer

A) True 
 B)False

Question 19

Other Income is used to:

Accepted Answer

A) record payments from sales customers. 
B) record any revenue from activities other than sales. 
C) record all revenue. 
D) record owner investments. 
A) record payments from sales customers. 
B) record any revenue from activities other than sales. 
C) record all revenue. 
D) record owner investments.

Question 20

The goal of closing entries is:

Accepted Answer

A) to clear revenue and expense accounts. 
B) to update the Capital account balance. 
C) to clear the Withdrawal account. 
D) All of these answers are correct. 
A) to clear revenue and expense accounts. 
B) to update the Capital account balance. 
C) to clear the Withdrawal account. 
D) All of these answers are correct.

How is Income Summary closed if the company had a net loss?

The ending merchandise inventory was overstated.This error would cause:

The reversing entry for Salaries is:

Determine the beginning inventory of a business having: Beginning Capital balance of $11,000 No additional investments or withdrawals Net sales of $43,500 Net purchases $26,000 Ending inventory of $4,250 Ending Capital balance of $10,000 Operating expenses of $16,500 $ ________

Determine the ending inventory of a business having: Beginning Capital $6,000 Net sales of $50,000 Net purchases of $30,500 Freight-in of $2,000 Beginning inventory of $4,000 Ending Capital of $10,000 Operating expenses of $14,000 $ ________

A company paid next month's rent in advance.This would be classified as a(n):

Net Purchases + Purchases Returns and Allowances + Purchase Discount equals:

In closing entries,the Income Summary account is closed to the Capital account after Withdrawals.

Discuss the purpose of a detailed income statement.Briefly describe the major kinds of business activities covered on a detailed income statement.

Closing entries:

Which of the following accounts will appear on the post-closing trial balance?

The entry to close the Withdrawal account was entered in reverse-the Withdrawal account was debited and Capital credited.This error would cause:

Gross profit minus Operating Expenses equals Net Income.

Other Income is used to:

The goal of closing entries is:

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes: The Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, plant, equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, dividends, treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters

Exam 12: Completion of the Accounting Cycle for a Merchandise Company

How is Income Summary closed if the company had a net loss?

The ending merchandise inventory was overstated.This error would cause:

The reversing entry for Salaries is:

Determine the beginning inventory of a business having: Beginning Capital balance of $11,000 No additional investments or withdrawals Net sales of $43,500 Net purchases $26,000 Ending inventory of $4,250 Ending Capital balance of $10,000 Operating expenses of $16,500 $ ________

Determine the ending inventory of a business having: Beginning Capital $6,000 Net sales of $50,000 Net purchases of $30,500 Freight-in of $2,000 Beginning inventory of $4,000 Ending Capital of $10,000 Operating expenses of $14,000 $ ________

A company paid next month's rent in advance.This would be classified as a(n):

Net Purchases + Purchases Returns and Allowances + Purchase Discount equals:

In closing entries,the Income Summary account is closed to the Capital account after Withdrawals.

Discuss the purpose of a detailed income statement.Briefly describe the major kinds of business activities covered on a detailed income statement.

Closing entries:

Which of the following accounts will appear on the post-closing trial balance?

The entry to close the Withdrawal account was entered in reverse-the Withdrawal account was debited and Capital credited.This error would cause:

Gross profit minus Operating Expenses equals Net Income.

Other Income is used to:

The goal of closing entries is:

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes: The Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, plant, equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, dividends, treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters