Question 1

Which of the following account titles would not be debited in the process of preparing closing entries for Andrew's Auto Shop?

Accepted Answer

A) Income Summary. 
B) Fees Earned. 
C) Dividends. 
D) Retained Earnings. 
A) Income Summary. 
B) Fees Earned. 
C) Dividends. 
D) Retained Earnings. C

Question 2

A current asset must be capable of being converted into cash within a relatively short period of time,usually less than five years.

Accepted Answer

A) True 
 B)False  False

Question 3

Which of the following amounts appears in both the Income Statement debit column and the Balance Sheet credit column of a worksheet?

Accepted Answer

A) Net income. 
B) Net loss. 
C) Dividends. 
D) Retained earnings. 
A) Net income. 
B) Net loss. 
C) Dividends. 
D) Retained earnings. A

Question 4

If a business closes its accounts only at year-end:

Accepted Answer

A) Financial statements are prepared only at year-end. 
B) Adjusting entries are made only at year-end. 
C) Revenue and expense accounts reflect year-to-date amounts throughout the year. 
D) Monthly and quarterly financial statements cannot be prepared. 
A) Financial statements are prepared only at year-end. 
B) Adjusting entries are made only at year-end. 
C) Revenue and expense accounts reflect year-to-date amounts throughout the year. 
D) Monthly and quarterly financial statements cannot be prepared.

Question 5

Which of the following accounts will be closed to Income Summary?

Accepted Answer

A) Prepaid Expenses. 
B) Unearned Revenue. 
C) Dividends. 
D) Depreciation Expense. 
A) Prepaid Expenses. 
B) Unearned Revenue. 
C) Dividends. 
D) Depreciation Expense.

Question 6

If current assets are $180,000 and current liabilities are $130,000,the current ratio will be:

Accepted Answer

A) 72%. 
B) $50,000. 
C) 1.4. 
D) $310,000. 
A) 72%. 
B) $50,000. 
C) 1.4. 
D) $310,000.

Question 7

Net income from the Income Statement appears on:

Accepted Answer

A) The Balance Sheet. 
B) The Retained Earnings Statement. 
C) Neither the Balance Sheet nor the Retained Earnings Statement. 
D) Both the Balance Sheet and the Retained Earnings Statement. 
A) The Balance Sheet. 
B) The Retained Earnings Statement. 
C) Neither the Balance Sheet nor the Retained Earnings Statement. 
D) Both the Balance Sheet and the Retained Earnings Statement.

Question 8

The Income Summary account has debits of $85,000 and credits of $75,000.The company had which of the following:

Accepted Answer

A) Net income of $10,000. 
B) Net income of $160,000. 
C) Net loss of $10,000. 
D) Net loss of $160,000. 
A) Net income of $10,000. 
B) Net income of $160,000. 
C) Net loss of $10,000. 
D) Net loss of $160,000.

Question 9

Most disclosures appear within the body of the financial statements; however,a few disclosures may also appear in the notes that accompany the financial statements.

Accepted Answer

A) True 
 B)False

Question 10

Publicly owned companies are typically managed by their stockholders.

Accepted Answer

A) True 
 B)False

Question 11

Indicate which of the following accounts will be closed to Income Summary at year-end.
(a)Cash
(b)Office Supplies Expense
(c)Unexpired Insurance
(d)Unearned Revenue
(e)Dividends
(f)Depreciation Expense
(g)Income Taxes Payable
(h)Accumulated Depreciation

Accepted Answer

(b)Office Supplies Expense and

Question 12

Return on equity is calculated by:

Accepted Answer

A) Dividing net income by total revenue. 
B) Dividing net income by average stockholders' equity. 
C) Dividing net income by working capital. 
D) Dividing dividends by stockholders' equity. 
A) Dividing net income by total revenue. 
B) Dividing net income by average stockholders' equity. 
C) Dividing net income by working capital. 
D) Dividing dividends by stockholders' equity.

Question 13

If current assets are $90,000 and current liabilities are $70,000,the current ratio will be:

Accepted Answer

A) 77%. 
B) $20,000. 
C) 1.3. 
D) $160,000. 
A) 77%. 
B) $20,000. 
C) 1.3. 
D) $160,000.

Question 14

An after-closing trial balance consists only of asset,liability,and owners' equity accounts.

Accepted Answer

A) True 
 B)False

Question 15

During the closing process:

Accepted Answer

A) All income statement accounts are credited to income summary. 
B) All income statement accounts are debited to income summary. 
C) All revenue accounts are credited and expense accounts are debited. 
D) All revenue accounts are debited and expense accounts are credited. 
A) All income statement accounts are credited to income summary. 
B) All income statement accounts are debited to income summary. 
C) All revenue accounts are credited and expense accounts are debited. 
D) All revenue accounts are debited and expense accounts are credited.

Question 16

Which of the following is true regarding a worksheet prepared at year-end?

Accepted Answer

A) The number of account titles applicable to the Adjusted Trial Balance columns is usually greater than the number of account titles applicable to the Trial Balance columns. 
B) The worksheet can be issued instead of financial statements. 
C) The worksheet eliminates the need to make adjusting and closing entries. 
D) An equal number of account titles are applicable to the Income Statement columns and the Balance Sheet columns. 
A) The number of account titles applicable to the Adjusted Trial Balance columns is usually greater than the number of account titles applicable to the Trial Balance columns. 
B) The worksheet can be issued instead of financial statements. 
C) The worksheet eliminates the need to make adjusting and closing entries. 
D) An equal number of account titles are applicable to the Income Statement columns and the Balance Sheet columns.

Question 17

Which account appears on the After-Closing Trial Balance?

Accepted Answer

A) Service Revenue. 
B) Unearned Revenue. 
C) Dividends. 
D) Retained Earnings,Beginning of Year. 
A) Service Revenue. 
B) Unearned Revenue. 
C) Dividends. 
D) Retained Earnings,Beginning of Year.

Question 18

Measures of profitability tell us how quickly current assets can be converted into profits.

Accepted Answer

A) True 
 B)False

Question 19

Only two adjustments appear in the adjustments column of a worksheet for Winona Mfg: one to record $8,000 depreciation of factory equipment,and the other to record the use of $1,500 of prepaid insurance.If the Trial Balance column totals are $145,380,what are the totals of the Adjusted Trial Balance columns?

Accepted Answer

A) $145,380. 
B) $153,380. 
C) $152,880. 
D) $154,880. 
A) $145,380. 
B) $153,380. 
C) $152,880. 
D) $154,880.

Question 20

Preparation of financial statements
Using the Adjusted Trial Balance shown below,prepare (a)an Income Statement and (b)a Statement of Retained Earnings for All Star Repairs.

Accepted Answer

The answer of Preparation of financial statements
Using the Adjusted Trial...

Exam 5: The Accounting Cycle: Reporting Financial Results

Which of the following account titles would not be debited in the process of preparing closing entries for Andrew's Auto Shop?

A current asset must be capable of being converted into cash within a relatively short period of time,usually less than five years.

Which of the following amounts appears in both the Income Statement debit column and the Balance Sheet credit column of a worksheet?

If a business closes its accounts only at year-end:

Which of the following accounts will be closed to Income Summary?

If current assets are $180,000 and current liabilities are $130,000,the current ratio will be:

Net income from the Income Statement appears on:

The Income Summary account has debits of $85,000 and credits of $75,000.The company had which of the following:

Most disclosures appear within the body of the financial statements; however,a few disclosures may also appear in the notes that accompany the financial statements.

Publicly owned companies are typically managed by their stockholders.

Indicate which of the following accounts will be closed to Income Summary at year-end. (a)Cash (b)Office Supplies Expense (c)Unexpired Insurance (d)Unearned Revenue (e)Dividends (f)Depreciation Expense (g)Income Taxes Payable (h)Accumulated Depreciation

Return on equity is calculated by:

If current assets are $90,000 and current liabilities are $70,000,the current ratio will be:

An after-closing trial balance consists only of asset,liability,and owners' equity accounts.

During the closing process:

Which of the following is true regarding a worksheet prepared at year-end?

Which account appears on the After-Closing Trial Balance?

Measures of profitability tell us how quickly current assets can be converted into profits.

Preparation of financial statements Using the Adjusted Trial Balance shown below,prepare (a)an Income Statement and (b)a Statement of Retained Earnings for All Star Repairs.

Accounting: Information for Decision Making

Basic Financial Statements

The Accounting Cycle: Capturing Economic Events

The Accounting Cycle: Accruals and Deferrals

Merchandising Activities

Financial Assets

Inventories and the Cost of Goods Sold

Plant and Intangible Assets

Liabilities

Stockholders Equity: Paid-In Capital

Income and Changes in Retained Earnings

Statement of Cash Flows

Financial Statement Analysis

Global Business and Accounting

Management Accounting: a Business Partner

Job Order Cost Systems and Overhead Allocations

Process Costing

Costing and the Value Chain

Cost-Volume-Profit Analysis

Incremental Analysis

Responsibility Accounting and Transfer Pricing

Operational Budgeting

Standard Cost Systems

Rewarding Business Performance

Capital Budgeting

Forms of Business Organization

The Time Value of Money: Future Amounts and Present Values

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