Question 1

The Capital account debited and the withdrawals credited would be the result of:

Accepted Answer

A) closing the Income Summary account-there is a net income. 
B) closing the withdrawal account. 
C) closing the Income Summary account-there is a net loss. 
D) closing the expense accounts. 
A) closing the Income Summary account-there is a net income. 
B) closing the withdrawal account. 
C) closing the Income Summary account-there is a net loss. 
D) closing the expense accounts.

Question 2

The correct order for closing accounts is:

Accepted Answer

A) revenue, expenses, income summary, withdrawals. 
B) revenue, income summary, expenses, withdrawals. 
C) revenue, expenses, capital, withdrawals. 
D) revenue, capital, expenses, withdrawals. 
A) revenue, expenses, income summary, withdrawals. 
B) revenue, income summary, expenses, withdrawals. 
C) revenue, expenses, capital, withdrawals. 
D) revenue, capital, expenses, withdrawals.

Question 3

B. Benson's worksheet showed the revenue account, Rental Fees, $1,300. The journal entry to close the account is:

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 4

The entry to close Income Summary (net loss)was entered in reverse-Income Summary was debited and Capital was credited. This error will cause:

Accepted Answer

A) Income Summary to have a credit balance. 
B) Income Summary to have a debit balance. 
C) the assets to be overstated. 
D) the liabilities to be overstated. 
A) Income Summary to have a credit balance. 
B) Income Summary to have a debit balance. 
C) the assets to be overstated. 
D) the liabilities to be overstated.

Question 5

M. Smuts showed a net income of $6,000. The entry to close the Income Summary account would include a:

Accepted Answer

A) debit to M. Smuts Capital, $6,000. 
B) credit to M. Smuts Capital, $6,000. 
C) debit to Income Summary, $6,000. 
D) Both B and C are correct. 
A) debit to M. Smuts Capital, $6,000. 
B) credit to M. Smuts Capital, $6,000. 
C) debit to Income Summary, $6,000. 
D) Both B and C are correct.

Question 6

Closing entries will update the Capital account to the same figure that is on the balance sheet for that date.

Accepted Answer

A) True 
 B)False

Question 7

Income Summary:

Accepted Answer

A) is a temporary account. 
B) is a permanent account. 
C) summarizes revenue and expenses and transfers the balance to Capital. 
D) Both A and C are correct. 
A) is a temporary account. 
B) is a permanent account. 
C) summarizes revenue and expenses and transfers the balance to Capital. 
D) Both A and C are correct.

Question 8

Closing entries are found in the adjustment columns of the worksheet.

Accepted Answer

A) True 
 B)False

Question 9

Why will the Income Summary account never appear on a financial statement?

Accepted Answer

The Income Summary account is used durin

Question 10

J. Oros showed a net loss of $3,200. The entry to close the Income Summary account would include a:

Accepted Answer

A) debit to Oros, Capital, $3,200. 
B) debit to Income Summary , $3,200. 
C) credit to Oros, Capital, $3,200. 
D) credit to Cash, $3,200. 
A) debit to Oros, Capital, $3,200. 
B) debit to Income Summary , $3,200. 
C) credit to Oros, Capital, $3,200. 
D) credit to Cash, $3,200.

Question 11

Which of the following is not a temporary account?

Accepted Answer

A) Wages Expense 
B) Service Fees 
C) Rent Expense 
D) Capital 
A) Wages Expense 
B) Service Fees 
C) Rent Expense 
D) Capital

Question 12

Closing entries:

Accepted Answer

A) need not be journalized since they appear on the worksheet. 
B) need not be posted if the financial statements are prepared from the worksheet. 
C) are not needed if adjusting entries are prepared. 
D) must be journalized and posted. 
A) need not be journalized since they appear on the worksheet. 
B) need not be posted if the financial statements are prepared from the worksheet. 
C) are not needed if adjusting entries are prepared. 
D) must be journalized and posted.

Question 13

The Rent Expense account had a normal balance of $1,100. The entry to close the account would include a:

Accepted Answer

A) debit to Rent Expense, $1,100. 
B) debit to Income Summary, $1,100. 
C) debit to Capital, $1,100. 
D) credit to Income Summary, $1,100. 
A) debit to Rent Expense, $1,100. 
B) debit to Income Summary, $1,100. 
C) debit to Capital, $1,100. 
D) credit to Income Summary, $1,100.

Question 14

To close the Fees Earned account:

Accepted Answer

A) debit Income Summary; credit Fees Earned. 
B) debit Fees Earned; credit Capital. 
C) debit Fees Earned; credit Income Summary. 
D) debit Capital; credit Fees Earned. 
A) debit Income Summary; credit Fees Earned. 
B) debit Fees Earned; credit Capital. 
C) debit Fees Earned; credit Income Summary. 
D) debit Capital; credit Fees Earned.

Question 15

The adjusting entry for accrued salaries is to:

Accepted Answer

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

Question 16

A real account is the same as a permanent account.

Accepted Answer

A) True 
 B)False

Question 17

Nominal accounts are called temporary accounts because their balances are not carried forward to the next accounting period.

Accepted Answer

A) True 
 B)False

Question 18

On the basis of the following data taken from the adjusted trial balance columns of the worksheet for the year ended December 31 for Painting the Perfect Picture, journalize the four closing entries in the proper order.

Accepted Answer

The answer of On the basis of the following data...

Question 19

The following normal account balances were found on the general ledger before closing entries were prepared:   After closing entries are posted, what is the balance in the Capital account?

Accepted Answer

A) $7,800 
B) $7,500 
C) $6,800 
D) Closing entries do not affect the Capital account. 
A) $7,800 
B) $7,500 
C) $6,800 
D) Closing entries do not affect the Capital account.

Question 20

Which of the following columns of the worksheet are referred to when preparing closing entries to the Income Summary?

Accepted Answer

A) Adjusted trial balance columns 
B) Balance sheet columns 
C) Adjustments columns 
D) Income statement columns 
A) Adjusted trial balance columns 
B) Balance sheet columns 
C) Adjustments columns 
D) Income statement columns

Exam 5: The Accounting Cycle Completed

The Capital account debited and the withdrawals credited would be the result of:

The correct order for closing accounts is:

B. Benson's worksheet showed the revenue account, Rental Fees, $1,300. The journal entry to close the account is:

The entry to close Income Summary (net loss)was entered in reverse-Income Summary was debited and Capital was credited. This error will cause:

M. Smuts showed a net income of $6,000. The entry to close the Income Summary account would include a:

Closing entries will update the Capital account to the same figure that is on the balance sheet for that date.

Income Summary:

Closing entries are found in the adjustment columns of the worksheet.

Why will the Income Summary account never appear on a financial statement?

J. Oros showed a net loss of $3,200. The entry to close the Income Summary account would include a:

Which of the following is not a temporary account?

Closing entries:

The Rent Expense account had a normal balance of $1,100. The entry to close the account would include a:

To close the Fees Earned account:

The adjusting entry for accrued salaries is to:

A real account is the same as a permanent account.

Nominal accounts are called temporary accounts because their balances are not carried forward to the next accounting period.

On the basis of the following data taken from the adjusted trial balance columns of the worksheet for the year ended December 31 for Painting the Perfect Picture, journalize the four closing entries in the proper order.

The following normal account balances were found on the general ledger before closing entries were prepared: After closing entries are posted, what is the balance in the Capital account?

Which of the following columns of the worksheet are referred to when preparing closing entries to the Income Summary?

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

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

Completion of the Accounting Cycle 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

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