Question 1

A nominal account is the same as a permanent account.

Accepted Answer

A) True 
 B)False

Question 2

The entry to close Income Summary (net loss)to Capital was omitted. This error will cause:

Accepted Answer

A) the ending capital to be overstated. 
B) the ending capital to be understated. 
C) no error in the ending capital balance. 
D) None of these are correct. 
A) the ending capital to be overstated. 
B) the ending capital to be understated. 
C) no error in the ending capital balance. 
D) None of these are correct.

Question 3

Which of the following is a real account?

Accepted Answer

A) Cash 
B) Fees Earned 
C) Utilities Expense 
D) Income Summary 
A) Cash 
B) Fees Earned 
C) Utilities Expense 
D) Income Summary

Question 4

The adjusting entry to record depreciation for the company automobile would be:

Accepted Answer

A) debit Accumulated Depreciation, Automobile; credit Depreciation Expense, Automobile. 
B) debit Accumulated Depreciation, Automobile; credit Automobile. 
C) debit Depreciation Expense, Automobile; credit Accumulated Depreciation, Automobile. 
D) debit Depreciation Expense, Automobile; credit Automobile. 
A) debit Accumulated Depreciation, Automobile; credit Depreciation Expense, Automobile. 
B) debit Accumulated Depreciation, Automobile; credit Automobile. 
C) debit Depreciation Expense, Automobile; credit Accumulated Depreciation, Automobile. 
D) debit Depreciation Expense, Automobile; credit Automobile.

Question 5

What are the major goals of the closing process?

Accepted Answer

Closing is a mechanical process that aid

Question 6

All closing entries must be posted before preparing the post-closing trial balance.

Accepted Answer

A) True 
 B)False

Question 7

The balance in Income Summary after posting all revenues and expenses for the period is equal to net income/loss.

Accepted Answer

A) True 
 B)False

Question 8

Income Summary does not have a normal balance.

Accepted Answer

A) True 
 B)False

Question 9

The goal of closing is to clear all temporary accounts and update Capital.

Accepted Answer

A) True 
 B)False

Question 10

Mark's Tree Service depreciation for the month is $600. The adjusting journal entry is:

Accepted Answer

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

Question 11

When the balance in the Income Summary account is a debit, the company has:

Accepted Answer

A) incurred a net loss. 
B) incurred a net income. 
C) had more revenue than expenses. 
D) made an error in their closing entries. 
A) incurred a net loss. 
B) incurred a net income. 
C) had more revenue than expenses. 
D) made an error in their closing entries.

Question 12

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 nature of the account (permanent/temporary).
Example:
  
-

Accepted Answer

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

Question 13

An account in which the balance is not carried over from one accounting period to the next is called a:

Accepted Answer

A) permanent account. 
B) real account. 
C) temporary account. 
D) zero account. 
A) permanent account. 
B) real account. 
C) temporary account. 
D) zero account.

Question 14

Each individual revenue account is debited when closing, and the total of all the revenue accounts is transferred to Income Summary.

Accepted Answer

A) True 
 B)False

Question 15

From the following accounts, prepare in proper form a post-closing trial balance for Matison Company on December 31.

Accepted Answer

The answer of From the following accounts, prepare in proper...

Question 16

Each individual expense account is debited when closing, and the total of all the expense accounts is transferred to Income Summary.

Accepted Answer

A) True 
 B)False

Question 17

From the following items in the income statement columns of the worksheet of Monaghan Company at December 31, prepare the closing entries without explanation, assuming that a $500 withdrawal was made during the period.

Accepted Answer

The answer of From the following items in the income...

Question 18

How do you close the expense accounts?

Accepted Answer

A) Debit Capital; credit the expense accounts 
B) Credit Capital; debit the expense accounts 
C) Credit Income Summary; debit the expense accounts 
D) Debit Income Summary; credit the expense accounts 
A) Debit Capital; credit the expense accounts 
B) Credit Capital; debit the expense accounts 
C) Credit Income Summary; debit the expense accounts 
D) Debit Income Summary; credit the expense accounts

Question 19

The first entry to close accounts is to debit Revenue and credit Income Summary.

Accepted Answer

A) True 
 B)False

Question 20

The Withdrawals account is closed to the Owner's Capital account.

Accepted Answer

A) True 
 B)False

Exam 5: The Accounting Cycle Completed

A nominal account is the same as a permanent account.

The entry to close Income Summary (net loss)to Capital was omitted. This error will cause:

Which of the following is a real account?

The adjusting entry to record depreciation for the company automobile would be:

What are the major goals of the closing process?

All closing entries must be posted before preparing the post-closing trial balance.

The balance in Income Summary after posting all revenues and expenses for the period is equal to net income/loss.

Income Summary does not have a normal balance.

The goal of closing is to clear all temporary accounts and update Capital.

Mark's Tree Service depreciation for the month is $600. The adjusting journal entry is:

When the balance in the Income Summary account is a debit, the company has:

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 nature of the account (permanent/temporary). Example: -

An account in which the balance is not carried over from one accounting period to the next is called a:

Each individual revenue account is debited when closing, and the total of all the revenue accounts is transferred to Income Summary.

From the following accounts, prepare in proper form a post-closing trial balance for Matison Company on December 31.

Each individual expense account is debited when closing, and the total of all the expense accounts is transferred to Income Summary.

From the following items in the income statement columns of the worksheet of Monaghan Company at December 31, prepare the closing entries without explanation, assuming that a $500 withdrawal was made during the period.

How do you close the expense accounts?

The first entry to close accounts is to debit Revenue and credit Income Summary.

The Withdrawals account is closed to the Owner's Capital account.

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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