Exam 4: Completing the Accounting Cycle

The Adjusted Trial Balance columns of the work sheet are prepared by combining the Trial Balance and Adjustments columns of the work sheet.

Use the numbers corresponding to the accounts below to indicate the entries for the transactions below. You may debit or credit more than one account. Dollar amounts have been omitted. The first one (x-y) has been done for you. 1. Accounts Receivable 2. Owner's Capital 3. Withdrawals 4. Cash 5. Income Summary 6. Legal Fees Earned 7. Rent Expense 8. Salaries Expense 9. Salaries Payable 10. Unearned Legal Fees x-y. To record cash invested by the owner a-b. To record the reversal of the entry that adjusted for accrued legal fees c-d. To close the Income Summary account when net income has been realized e-f. To record the closing of expense account(s) g-h. To record payment of salaries for which an adjusting entry was made a few days before. The appropriate reversing entry also was made.

From the following items in the Income Statement columns of the work sheet of Bower Company at December 31, 20xx, prepare the closing entries without explanations, assuming that a $50 withdrawal was made by the owner during the period.

During the performance of the steps in the accounting cycle, trial balances are prepared in three different steps. Using specific names where applicable, discuss the time of preparation and the purpose served by each of these trial balances.

An important purpose of closing entries is to

Omitting key letters in the work sheet would make which of the following difficult?

On the work sheet, account balances are "extended" from the

Closing entries ultimately will affect

The adjustment dated 12/31/20x1 to accrue interest to be paid most likely would be reversed by which of the following entries?

Information from the Income Statement columns of the work sheet of Landry Laundry Service is provided below: The entry to close Income Summary is

The post-closing trial balance will have fewer accounts than the adjusted trial balance

What does the preparation of reversing entries accomplish?

Use the following adjusted trial balance to answer the question(s) below. The entry to close Income Summary is

A reversing entry will include either a debit to a revenue account or a credit to an expense account.

Which of the following types of entries is made primarily to help conform to the matching principle?

The process of crossfooting requires vertical addition and subtraction.

The process of crossfooting on the work sheet results in the

The primary objective of reversing entries is to

Under which circumstance would one less closing entry than usual be made?

An amount would not appear opposite the Withdrawals account in which of the following work sheet columns?