Exam 5: Completing the Accounting Cycle Closing and Reversing Entries

The retained earnings balance of The Jackman Company was $50 000 on the first day of the accounting year. Profit during the year was $120 000. At the end of the accounting year a dividend of $15 000 was declared. The dividend will be paid the following year. The year-end balance of retained earnings is:

Closing entries are recorded:

Assume reversing entries are made by the entity. If wages of $2600 were accrued at the end of the year and the first payment of wages the following year was $33 100 how would this payment be recorded?

If a loss has been incurred for the year, the profit or loss summary account, before it is closed off, has a_________ balance.

Assume that no reversing entries are made by the entity. How would the entity record the transaction for payment of wages if $5200 was accrued for wages at the end of the year and the first payment of wages in the following year was $63 900?

Which of the following is a permanent account?

Retained earnings is what type of account?

Interim statements are:

A post-closing trial balance provides:

Prince Ltd's year-end trial balance includes the following accounts. I. Cash II. Sales revenue III. Accounts receivable IV. Owner's capital V. Interest expense VI. Interest payable VII. Prepayments Which of these are temporary accounts?

Accounting entries made to reduce the temporary accounts to zero balances are known as:

Closing an account means:

Which of the following statements is true?

Which of the following accounts is closed to the profit or loss summary account?

The end of the financial year for Reynolds Ltd is 31 December. At that date, salaries and wages expenses of $580 000 is closed to the profit and loss summary account. This balance includes $550 000 for salaries and wages paid in cash during the year and accrued wages at the end of the year of $30 000. Reynolds Ltd records a reversing entry for the accrued wages on 1 January. The first payment to employees for salaries and wages in the new financial year is $35 000. This payment would be recorded as:

Income and expenses are accumulated for only one year and are therefore known as:

Adjusting entries prepared for interim financial statements are:

The salaries expense account on the worksheet shows an opening balance of $15 000. The worksheet includes a reversing entry for $1800 for salaries prepaid in the previous year and $1400 for salaries accrued in the current year. The balance of the salaries expense account that will be transferred to the income statement column is:

entries are recorded at the end of a financial year to reduce expense and income accounts to zero balances.

A trial balance produced after the completion of the closing process is called a: