Exam 4: Completing the Accounting Cycle

Journalizing and posting the adjustments and closing entries updates the ledger for the new accounting period.

Use the information in the adjusted trial balance for Stockton Company to answer the questions that follow. Determine total assets.

Liabilities that will be due within one year or less and that are to be paid out of current assets are called current liabilities.

The following accounts appear in an adjusted trial balance of Brock Pool Service Company. Indicate whether each account would be reported in the (a) current assets, (b) property, plant, and equipment, (c) current liabilities, (d) long-term liabilities, or (e) stockholders' equity section of the December 31, 2011, balance sheet of Brock Pool Service Company.

Examples of temporary accounts are supplies and prepaid expenses which are in the ledger for just a short time before they expire.

Amir Designs purchased a one-year liability insurance policy on March 1st of this year for $5,400 and recorded it as a prepaid expense. Which of the following amounts would be recorded for insurance expense during the adjusting process at the end of Amir's first month of operations on March 31st?

Capital Stock and Dividends are reported in the stockholders' equity section of the balance sheet.

The following balance sheet contains errors. (a) List the errors in the balance sheet above and (b) prepare a corrected balance sheet.

The retained earnings statement begins with the beginning balance followed by

Cash, Accounts Payable, and Capital Stock are real accounts and do get closed at the end of the period.

The following accounts were taken from the Adjusted Trial Balance columns of the work sheet for the year ended April 30, 2011, for Finnegan Co.: Prepare an income statement.

On the basis of the following data taken from the Adjusted Trial Balance columns of the work sheet for the year ended March 31 for Boles Athletic Company, journalize the four closing entries.

Use the information in the adjusted trial balance for Stockton Company to answer the questions that follow. Determine the net income (loss) for the period.

The unadjusted, adjusted, and final trial balances are prepared during the accounting cycle of a period.

Entries required to close the balances of the temporary accounts at the end of the period are called final entries.

Prepare an income statement and a retained earnings statement for the month ended August 31, 2011, from the following T accounts of Marley Company.

Prepaid insurance is reported on the balance sheet as a

The following is the adjusted trial balance for Nadia Company prepared at the end of Nadia's fiscal year. Prepare an income statement, retained earnings statement, and classified balance sheet.

After all of the account balances have been extended to the Balance Sheet columns of the work sheet, the totals of the debit and credit columns are $37,875 and $32,735, respectively. What is the amount of net income or net loss for the period?

The trial balance may be listed on the work sheet instead of being prepared separately.