Exam 5: Closing Entries and the Post-Closing Trial Balance

Munoz Co. prepays cash in October for insurance that covers only the month of November. Munoz Co. records the expense in October. Which method of accounting is Munoz Co. using?

Match the terms that follow with the correct definitions. -Clearing the accounts or bringing to zero balance

Which of the following is true of the effect of net loss on financial statements?

The Income Summary account would be reported on which financial statement?

The last step in the closing procedure closes

After closing the expense accounts, the total of the expense accounts will appear on the debit side of the Income Summary account.

Below is an alphabetical list of accounts of Master Cleaners as of December 31, after all adjusting entries have been posted. Instructions: Accounts Payable \ 2,700 Accumulated Depreciation, Equipment 2,800 Cash 2,600 Depreciation Expense, Equipment 700 E. Hess, Capital 6,200 E. Hess, Drawing 7,000 Equipment 12,300 Income from Services 29,800 Income Summary Insurance Expense 1,600 Miscellaneous Expense 300 Frepaid Insurance 200 Rent Expense 2,400 Advertising Expense 900 Utilities Expense 800 Wages Expense 3,700 1. Journalize the four closing entries in the proper order. 2. Record the account balances in t-accounts for owner's equity, revenue, and expense accounts. Post the closing entries in these t-accounts using number 1 through 4. 3. Prepare a post-closing trial balance.

Closing entries are prepared to close the

If L. Green's total revenue for the year was $38,000 and total expenses were $30,000, the third closing entry would be

Both income statement and balance sheet accounts are closed at the end of a fiscal period.

Which of the following accounts would not be involved in closing entries?

The balance in the owner's Capital account is closed to the owner's Drawing account.

Which of the following sequences of documents or records describes the proper sequence in the accounting cycle?

The adjusted balances for Tomas Co. are listed below. Cash, $20,000 Accounts Receivable, $2,500 Prepaid Insurance, $3,500 Equipment, $15,000 Accumulated Depreciation, $2,000 Accounts Payable, $4,000 J. Tomas, Capital, $30,000 J. Tomas, Drawing, $10,000 Income from Services, $35,000 Wages Expense, $12,000 Rent Expense, $8,000 The entry to close expenses would involve a

The entry to close Income Summary, assuming a net loss, would involve a

The salaries payable account is:

The balance of Accumulated Depreciation will normally appear on the income statement.

Which of the following are all temporary accounts?

Match the terms that follow with the correct definitions. -List of the final balances of the general ledger after end-of-year procedures

Match the terms that follow with the correct definitions. -Process in which preparing the post-closing trial balance is the last step