Exam 4: Completing the Accounting Cycle

Bob Evans owns a business, Beachside Realty, that rents condominiums and furnishings. Below is the adjusted trial balance at December 31, 2014. The entry required to close the revenue accounts at the end of the period includes a:

Which of the following accounts ordinarily appears in the post-closing trial balance?

A net loss is shown on the work sheet in the credit columns of both the Income Statement columns and the Balance Sheet columns.

Each of the following transactions for Morrison Company requires an adjusting entry, which if omitted, will overstate or understate assets, liabilities, owner's equity, revenues, expenses, or net income. Indicate the amount and direction of the misstatement that would result if the end of period adjusting entry suggested by the transaction was omitted. Place your results in the table following the transactions and use (+) for overstate, (-) for understate, and (NE) for no effect. 1. Morrison purchased supplies on December 1 for $900. On December 31, $350 of supplies were on hand. 2. Prepaid insurance had a debit balance of $5,400 on December 1, which represented a prepayment for 2 years of insurance. 3. The unearned rent revenue account has a credit balance of $390 on December 1, which represents 3 months rent.

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 show debits of $37,686 and the credits of $41,101. This indicates that

Use the following worksheet to answer the following questions. Based on the preceding trial balance, the entry to close

A fiscal year that ends when business activities have reached their lowest point is called the natural business year.

Prepaid insurance is reported on the balance sheet as a

Assets, liabilities, and owner's capital are real accounts and do get closed at the end of the period.

The difference between the totals of the debit and credit columns of the Adjusted Trial Balance columns on a work sheet

Hakik Enterprises offers rug cleaning services to business clients. Below are the adjustments data for the year ended July 31, 2010. REQUIRED: Using this information along with the spreadsheet below, record the adjusting entries in proper general journal form. Adjustments: a) The equipment is estimated to last for 5 years with no salvage value. The asset will be depreciated evenly over its useful life. Please record one month's depreciation. b) Accrued Wages $2. c) Unused supplies on hand $8. d) Of the unearned revenue, 75% has been earned. e) Unexpired insurance remaining at the end of the month, $9.

The income statement is prepared from:

Notes Receivable due in 350 days appear on the

Any twelve-month accounting period adopted by a company is known as its fiscal year.

List and describe the purpose of the four closing entries. 1. Close revenues to income summary. 2. Close expenses to income summary. 3. Close income summary to capital account. 4. Close drawing account to capital account.

Bob Evans owns a business, Beachside Realty, that rents condominiums and furnishings. Below is the adjusted trial balance at December 31, 2014. The entry required to close the expense accounts at the end of the period includes a:

On which financial statement will Income Summary be shown?

The Balance Sheet should be prepared

Cash and other assets that may reasonably be expected to be realized in cash, sold, or consumed through the normal operations of a business, usually longer than one year, are called current assets.

In the accounting cycle, the last step is