Exam 4: Completing the Accounting Cycle

Closing entries deal primarily with the balances of real accounts.

In the accounting cycle, information from source documents is initially recorded in the journal.

The Trial Balance and Adjusted Trial Balance columns of Kathy's Cleaning Company's work sheet are shown below. (The Adjustments columns, of course, have been omitted.) In the journal provided, prepare the six adjusting entries and the four closing entries for the month ended June 30, 20xx. No explanations are needed.

Using the information below from the Income Statement and Balance Sheet columns of Hayes Company's work sheet for the month ended April 30, 20xx, prepare the income statement, statement of owner's equity, and balance sheet.

Which of the following accounts probably would have a smaller balance in the Adjusted Trial Balance columns of a work sheet than in the Trial Balance columns?

Despite the many uses of microcomputers, they cannot be used to prepare work sheets.

Working papers provide a written record of the work performed by the accountant or auditor.

During the closing process, revenues are transferred to the credit side of the Income Summary account.

Doug Riley is the only accountant employed at Carmen Enterprises. When asked by the company president if the financial statements had been prepared yet, Doug answered that he had completed all of his work except the preparation of the statements. He added that the net income that would appear on the current income statement would be $392,180. Identify the two instances where Doug would have determined the net income before he actually prepared the financial statements.

The owner's Capital, Withdrawals, and Income Summary accounts for Harmon Repair Company for the accounting period are presented below in T account form after the recording and posting of closing entries: The total amount of revenue earned for the period is

A reversing entry could include a

The only accounts that are closed are income statement accounts.

Prepare closing entries for December without explanations from the following Income Statement columns of the work sheet of Duffy Cleaning Service, assuming that a $250 owner withdrawal was made during the period.

The adjusting entries involving Depreciation Expense-Buildings and Supplies Expense could be reversed.

Use the following adjusted trial balance to answer the question(s) below. The entry to close the Ship Rentals account is

Financial statements cannot be prepared correctly until the accounts have been adjusted.