Exam 4: Completing the Accounting Cycle and Classifying Accounts

The eight recurring steps performed each accounting period,starting with recording transactions in the journal and continuing through the post-closing trial balance,is called the:

A trial balance prepared after the adjusting and closing entries have been posted,and which is the final step in the accounting cycle,is a(n):

Which of the following statements is incorrect?

In order,the last four steps in the accounting cycle include preparing the adjusted trial balance,preparing financial statements,preparing adjusting entries and preparing closing entries.

After posting the entries to close all revenue accounts and all expense accounts,the Income Summary account of Waif Services has a $4,000 debit balance.This shows that Waif Services earned a net income of $4,000.

Journal entries recorded at the end of each accounting period to prepare the revenue,expense,and withdrawals accounts for the upcoming year and to update the owner's capital account for the events of the year just finished are:

Assets are classified into current assets,investments,property,plant and equipment,and intangible assets.

Discuss the purpose of a post-closing trial balance.

A work sheet is a substitute for the financial statements.

Which of the following statements is incorrect?

The ending balance of owner's capital is calculated as:

Which of the following is the final step in the accounting cycle?

The aim of a post-closing trial balance is to verify that (1)total debits equal total credits for temporary accounts and (2)all temporary accounts have zero balances.

The withdrawals account is normally closed by debiting it.

The first step in the accounting cycle is to analyze and record transactions during the accounting period.

Explain why temporary accounts are closed each period.

Reversing entries are:

If interim financial statements are required,adjusting entries must be journalized and posted to obtain the adjusted data needed for their preparation.

On the work sheet,a loss is indicated if the total of the Income Statement Debit column exceeds the total of the Income Statement Credit column.

The items that follow appeared in the Income Statement columns of the work sheet prepared for a sole proprietorship at year-end,December 31,2015.Also,the owner's withdrawals account was debited for $12,000 during the year.Prepare the necessary closing entries at December 31.