Question 1

The journal entry to close the Fees Earned,$750,and Rent Revenue,$175,accounts on December 31st during the closing process would be:

Accepted Answer

A)  Dec.31 Fees Earned 750 Rent Revenue 175Income Summary 925
B)  Dec.31 Income Summary 925 Fees Earned 750Rent Revenue 175
C)  Dec.31 Revenues 575 Income Summary 575
D)  Dec.31 Income Summary 925 Revenues 925 A

Question 2

The income summary account is also known as the clearing account.

Accepted Answer

A) True 
 B)False  True

Question 3

If working papers are not considered part of the formal accounting records,then why are they used?

Accepted Answer

Working papers are tools used by accountants to collect and summarize data for various analysis and reports.

Question 4

What is the last account that should be listed in the post-closing trial balance?

Accepted Answer

A)  Income Summary
B)  Retained Earnings
C)  Cash
D)  Fees Earned

Question 5

Accrued taxes payable are generally reported on the balance sheet as a current liability.

Accepted Answer

A) True 
 B)False

Question 6

Since the adjustments are entered on the work sheet,it is necessary to record them in the journal or post them to the ledger.

Accepted Answer

A) True 
 B)False

Question 7

The unequal totals of the debit and credit columns of the Adjusted Trial Balance columns on a work sheet

Accepted Answer

A)  indicates the amount of net income or loss
B)  indicates there is an error on the work sheet
C)  is not unusual when preparing the work sheet
D)  is the net difference between revenue,expenses,and dividends

Question 8

The work sheet is a working paper that accountants can use to summarize adjusting entries and the account balances for the financial statements.

Accepted Answer

A) True 
 B)False

Question 9

The unadjusted,adjusted,and post-closing trial balances are the three types of trial balances prepared in an accounting cycle.

Accepted Answer

A) True 
 B)False

Question 10

The following accounts were taken from the Adjusted Trial Balance columns of the work sheet for the year ended April 30,2011,for Finnegan Co.:
  
Prepare an income statement.

Accepted Answer

The answer of The following accounts were taken from the...

Question 11

The income summary account is closed to the retained earnings account.

Accepted Answer

A) True 
 B)False

Question 12

Use the work sheet for Finley Company to answer the questions that follow.

The entry to close Income Summary would be

Accepted Answer

A)  debit Retained Earnings,$50,000;credit Income Summary,$50,000
B)  debit Income Summary,$155,000;credit Retained Earnings,$155,000
C)  debit Income Summary,$50,000;credit Retained Earnings,$50,000
D)  debit Retained Earnings,$9,000;credit Income Summary,$9,000

Question 13

When accounts do appear on the unadjusted trial balance but are needed to post adjustments,they are simply added to the account title column.

Accepted Answer

A) True 
 B)False

Question 14

In the accounting cycle,the last step is

Accepted Answer

A)  preparing the financial statements
B)  journalizing and posting the adjusting entries
C)  preparing a post-closing trial balance
D)  journalizing and posting the closing entries

Question 15

Accumulated Depreciation is a permanent account.

Accepted Answer

A) True 
 B)False

Question 16

Which one of the fixed asset accounts listed below will not have a related contra asset account?

Accepted Answer

A)  Office Equipment
B)  Land
C)  Delivery Equipment
D)  Building

Question 17

The income summary account is also called

Accepted Answer

A)  the imprest account
B)  the clearing account
C)  the adjustments account
D)  the helpful account

Question 18

Accrued expenses are ordinarily listed on the balance sheet as current assets.

Accepted Answer

A) True 
 B)False

Question 19

Prepaid Insurance is an example of a current asset.

Accepted Answer

A) True 
 B)False

Question 20

Accumulated depreciation appears on the

Accepted Answer

A)  balance sheet in the current assets section
B)  balance sheet in the property,plant and equipment section
C)  balance sheet in the long-term liabilities section
D)  income statement as an operating expense

Exam 4: Completing the Accounting Cycle

The journal entry to close the Fees Earned,$750,and Rent Revenue,$175,accounts on December 31st during the closing process would be:

The income summary account is also known as the clearing account.

If working papers are not considered part of the formal accounting records,then why are they used?

What is the last account that should be listed in the post-closing trial balance?

Accrued taxes payable are generally reported on the balance sheet as a current liability.

Since the adjustments are entered on the work sheet,it is necessary to record them in the journal or post them to the ledger.

The unequal totals of the debit and credit columns of the Adjusted Trial Balance columns on a work sheet

The work sheet is a working paper that accountants can use to summarize adjusting entries and the account balances for the financial statements.

The unadjusted,adjusted,and post-closing trial balances are the three types of trial balances prepared in an accounting cycle.

The following accounts were taken from the Adjusted Trial Balance columns of the work sheet for the year ended April 30,2011,for Finnegan Co.: Prepare an income statement.

The income summary account is closed to the retained earnings account.

Use the work sheet for Finley Company to answer the questions that follow. The entry to close Income Summary would be

When accounts do appear on the unadjusted trial balance but are needed to post adjustments,they are simply added to the account title column.

In the accounting cycle,the last step is

Accumulated Depreciation is a permanent account.

Which one of the fixed asset accounts listed below will not have a related contra asset account?

The income summary account is also called

Accrued expenses are ordinarily listed on the balance sheet as current assets.

Prepaid Insurance is an example of a current asset.

Accumulated depreciation appears on the