Exam 6: Financial Statements and the Closing Process

The steps involved in handling all of the transactions and events completed during an accounting period,beginning with placing data in a book of original entry and ending with a post-closing trial balance,are referred to collectively as the accounting cycle.

The statement of owner's equity is prepared from information from the asset and liability accounts.

Match the terms with the definitions. -The steps involved in accounting for all of the business activities during an accounting period.

Revenues and expenses are temporary accounts and are closed at the end of the accounting period.

After the accounts are closed and the journal entries have been posted,which of the following accounts would have a balance?

The end-of-period work sheet is completed after adjusting entries have been recorded and posted.

On December 31,20--,after adjustments,Tuscany Company's general ledger contains the account balances as shown on the partially completed work sheet below.Journalize the (four)closing entries necessary at the end of December. ​ ​ ​

Seascape Marina,Inc.had the following transactions during May of the current year. Required: Classify each transaction as an operating,investing,or financing activity and prepare a statement of cash flows. a. Invested $\$ 25,000$ cash in the business. b. Paid office rent, $\$ 1,200$ . c. Purchased office equipment. Paid $\$ 4,500$ in cash and agreed to pay the balance in six monthly installments. d. Paid cash for advertising in Seaview magazine, $\$ 900$ . e. Received cash for six research assignments, $\$ 3,600$ . f. Paid telephone bill, $\$ 240$ . g. Made payment on loan from transaction (c), $\$ 800$ . h. Withdrew cash for personal use, $\$ 1,800$ . i. Paid wages to office assistant, $\$ 600$ .

An income statement is an itemized statement that provides information regarding the status of the assets,liabilities,and owner's equity of a business enterprise as of a specified date.

A form of balance sheet that lists the assets at the left and the liabilities and owner's equity at the right is called a report form of balance sheet.

The journal entry to close the drawing account includes

Obligations that are not expected to be paid within a year and do not require the use of current assets are known as ____________________.

The accounts shown in the post-closing trial balance are the ____________________ accounts.

Match the terms with the definitions. -Obligations that are due within either one year or the normal operating cycle of the business,whichever is longer,and that are to be paid out of current assets.

Revenue and expense account are permanent accounts.

Changes in owner's equity that result from investments or withdrawals of assets by the owner are included in the

When recording closing entries in the general journal,which of the following is written in the Description column?

The amounts in the financial statements must agree with the ledger account balances.

Match the terms with the definitions. -The process of giving zero balances to the temporary accounts so that they can accumulate information for the next accounting period.

Match the terms with the definitions. -A balance sheet in which the liabilities and the owner's equity sections are shown below the assets section.