Question 1

A company had a normal $50,000 cash balance on their adjusted trial balance.If revenues,expenses and dividends respectively were $90,000;$18,000 and $2,000 what amount of cash will be found on the post-closing trial balance?

Accepted Answer

A) $122,000 normal balance 
B) $50,000 normal balance 
C) $120,000 normal balance 
D) $160,000 normal balance

Question 2

Closing entries included debits to revenues for a total of $5,000,credits to expenses for a total of $3,000,and a credit to dividends for $1,000.The net income for the month was:

Accepted Answer

A) $1,000. 
B) $2,000. 
C) $3,000. 
D) $4,000.

Question 3

The Income Statement that is prepared from the adjusted trial balance begins with the:

Accepted Answer

A) first asset account listed on the adjusted trial balance. 
B) first liability account listed on the adjusted trial balance. 
C) first revenue account listed on the adjusted trial balance. 
D) first expense account listed on the adjusted trial balance.

Question 4

To prove the equality of the debit and credit balances in the general ledger accounts after the closing entries have been journalized and posted,prepare the adjustments.

Accepted Answer

A) True 
 B)False

Question 5

The balance in the Depreciation Expense account on the adjusted trial balance:

Accepted Answer

A) is generally equal to the balance on the unadjusted trial balance. 
B) is generally greater than the balance on the unadjusted trial balance. 
C) is generally less than the balance on the unadjusted trial balance. 
D) has no relationship to the balance on the unadjusted trial balance.

Question 6

The recording of depreciation is related to a(n):

Accepted Answer

A) deferred expense. 
B) deferred revenue. 
C) accrued expense. 
D) accrued revenue.

Question 7

Closing entries included debits to revenues for a total of $8,000,credits to expenses for a total of $4,000,and a credit to dividends for $650.The net change in Retained Earnings for the month was:

Accepted Answer

A) cannot be calculated with the information provided. 
B) $3,350. 
C) $4,000. 
D) $4,650.

Question 8

The balance in the Supplies account on the adjusted trial balance:

Accepted Answer

A) is generally equal to the balance on the unadjusted trial balance. 
B) is generally greater than the balance on the unadjusted trial balance. 
C) is generally less than the balance on the unadjusted trial balance. 
D) has no relationship to the balance on the unadjusted trial balance.

Question 9

It does not matter when a fiscal year starts as long as it is twelve consecutive months long.

Accepted Answer

A) True 
 B)False

Question 10

The post-closing trial balance is a listing of the general ledger accounts that have balances at the end of the accounting period.

Accepted Answer

A) True 
 B)False

Question 11

Revenues,expenses and Dividends are called permanent accounts.

Accepted Answer

A) True 
 B)False

Question 12

Respectively,Inventory,Accounts Receivable,and Accounts Payable are:

Accepted Answer

A) temporary,permanent,and temporary accounts. 
B) temporary,temporary,and permanent accounts. 
C) all temporary accounts. 
D) all permanent accounts.

Question 13

Dividends paid and net losses are:

Accepted Answer

A) additions to Retained Earnings. 
B) subtractions from Retained Earnings. 
C) additions to net income. 
D) subtractions from net income.

Question 14

A piece of equipment cost $1,000 and has a salvage value of $200.If it has an 8-year life,the annual depreciation expense under straight-line depreciation would be:

Accepted Answer

A) $125. 
B) $100. 
C) $200. 
D) $800.

Question 15

All financial statements must have,in order,the:

Accepted Answer

A) title of financial statement and specific date. 
B) title of financial statement,name of company,and specific date. 
C) name of company,title of financial statement,and specific date. 
D) name of company,title of financial statement,and a specific date or period.

Question 16

Recording the collection of three months of advance rent from a client in an unearned account would be an example of a(n):

Accepted Answer

A) deferred expense. 
B) deferred revenue. 
C) accrued expense. 
D) accrued revenue.

Question 17

Recording Unearned Subscriptions Revenue would be an example of a(n):

Accepted Answer

A) deferred expense. 
B) deferred revenue. 
C) accrued expense. 
D) accrued revenue.

Question 18

If Bloom company records revenue when cash is received,they are using the:

Accepted Answer

A) cash basis of accounting. 
B) accrual basis of accounting. 
C) adjustment basis of accounting. 
D) expense basis of accounting.

Question 19

The post-closing accounting equation is:

Accepted Answer

A) assets = liabilities + common stock + Retained Earnings - dividends. 
B) assets = liabilities + common stock + Retained Earnings. 
C) assets = liabilities + Retained Earnings + revenues - expenses. 
D) assets = liabilities + Retained Earnings - dividends.

Question 20

Under accrual accounting,the most important GAAP concepts to remember are the recognition principle for expenses and the matching principle for revenues.

Accepted Answer

A) True 
 B)False

Exam 3: Adjusting and Closing Entries

A company had a normal $50,000 cash balance on their adjusted trial balance.If revenues,expenses and dividends respectively were $90,000;$18,000 and $2,000 what amount of cash will be found on the post-closing trial balance?

Closing entries included debits to revenues for a total of $5,000,credits to expenses for a total of $3,000,and a credit to dividends for $1,000.The net income for the month was:

The Income Statement that is prepared from the adjusted trial balance begins with the:

To prove the equality of the debit and credit balances in the general ledger accounts after the closing entries have been journalized and posted,prepare the adjustments.

The balance in the Depreciation Expense account on the adjusted trial balance:

The recording of depreciation is related to a(n) :

Closing entries included debits to revenues for a total of $8,000,credits to expenses for a total of $4,000,and a credit to dividends for $650.The net change in Retained Earnings for the month was:

The balance in the Supplies account on the adjusted trial balance:

It does not matter when a fiscal year starts as long as it is twelve consecutive months long.

The post-closing trial balance is a listing of the general ledger accounts that have balances at the end of the accounting period.

Revenues,expenses and Dividends are called permanent accounts.

Respectively,Inventory,Accounts Receivable,and Accounts Payable are:

Dividends paid and net losses are:

A piece of equipment cost $1,000 and has a salvage value of $200.If it has an 8-year life,the annual depreciation expense under straight-line depreciation would be:

All financial statements must have,in order,the:

Recording the collection of three months of advance rent from a client in an unearned account would be an example of a(n) :

Recording Unearned Subscriptions Revenue would be an example of a(n) :

If Bloom company records revenue when cash is received,they are using the:

The post-closing accounting equation is:

Under accrual accounting,the most important GAAP concepts to remember are the recognition principle for expenses and the matching principle for revenues.