Question 1

Closing the temporary accounts at the end of each accounting period does all of the following except:

Accepted Answer

A)   Serves to transfer the effects of these accounts to the owner's capital account on the balance sheet.
B)   Prepares the withdrawals account for use in the next period.
C)   Gives the revenue and expense accounts zero balances.
D)   Has no effect on the owner's capital account.
E)   Causes owner's capital to reflect increases from revenues and decreases from expenses and withdrawals.F) A) and B)
G) D) and E)

Question 2

Harry's Bikes' current assets are $400 million and its current liabilities are $250 million. Its current ratio is 0.63.

Accepted Answer

A) True 
 B)False

Question 3

The Income Summary account is used to close the permanent accounts at the end of an accounting period.

Accepted Answer

A) True 
 B)False

Question 4

Describe a work sheet and explain why it is useful.

Accepted Answer

A work sheet is a useful tool for organi...

Question 5

Accounts that appear in the balance sheet are often called temporary (nominal) accounts.

Accepted Answer

A) True 
 B)False

Question 6

Long-term investments can include land held for future expansion.

Accepted Answer

A) True 
 B)False

Question 7

The aim of a post-closing trial balance is to verify that (1) total debits equal total credits for temporary accounts, and (2) all temporary accounts have zero balances.

Accepted Answer

A) True 
 B)False

Question 8

The third closing entry is to close Owner's Capital to the Owner's Withdrawals account.

Accepted Answer

A) True 
 B)False

Question 9

A partially completed work sheet is shown below. The unadjusted trial balance columns are complete. Complete the adjustments, adjusted trial balance, income statement, and balance sheet and statement of changes in equity columns.

Accepted Answer

The answer of A partially completed work sheet is shown...

Question 10

List and explain the steps in preparing a 10-column worksheet.

Accepted Answer

1. Enter the unadjusted trial balance. L...

Question 11

On a work sheet, a loss is indicated if the total of the Income Statement Debit column exceeds the total of the Income Statement Credit column.

Accepted Answer

A) True 
 B)False

Question 12

J. Awn, the proprietor of Awn Services, withdrew $8,700 from the business during the current year. The entry to close the withdrawals account at the end of the year is:

Accepted Answer

A)   Debit J. Awn, Withdrawals $8,700; credit Cash, $8,700
B)   Debit J. Awn, Capital $8,700; credit J. Awn, Withdrawals $8,700
C)   Debit J. Awn, Withdrawals $8,700; credit J. Awn, Capital $8,700
D)   Debit J. Awn, Capital $8,700, credit Salary Expense $8,700
E)   Debit Income Summary $8,700; credit J. Awn, Capital $8,700F) A) and B)
G) None of the above

Question 13

Use the information in the adjusted trial balance presented below to calculate the current ratio for Jones Company:

Accepted Answer

A)   1.87.
B)   .54.
C)   3.92.
D)   1.77.
E)   1.60.F) C) and D)
G) B) and D)

Question 14

List the steps in the accounting cycle.

Accepted Answer

The accounting cycle consists of ten ste...

Question 15

The following information is available for Crandall Company before closing the accounts. After all of the closing entries are made, what will be the balance in the Crandall, Capital account?

Accepted Answer

A)   $115,000.
B)   $225,000.
C)   $264,000.
D)   $186,000.
E)   $956,000.F) D) and E)
G) A) and B)

Question 16

Match the following terms with the appropriate definition.

Accepted Answer

The answer of Match the following terms with the appropriate...

Question 17

Which of the following statements is incorrect?

Accepted Answer

A)   Permanent accounts is another name for nominal accounts.
B)   Temporary accounts carry a zero balance at the beginning of each accounting period.
C)   The Income Summary account is a temporary account.
D)   Real accounts remain open as long as the asset, liability, or equity items recorded in the accounts continue in existence.
E)   The closing process applies only to temporary accounts.F) C) and D)
G) B) and D)

Question 18

Closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period.

Accepted Answer

A) True 
 B)False

Question 19

The accounting cycle refers to the sequence of steps in preparing the work sheet.

Accepted Answer

A) True 
 B)False

Question 20

The adjusted trial balance of the Thomas Company follows:
Prepare the closing entries for Thomas Company.

Accepted Answer

The answer of The adjusted trial balance of the Thomas...

Exam 4: Completing the Accounting Cycle

The aim of a post-closing trial balance is to verify that (1) total debits equal total credits for temporary accounts, and (2) all temporary accounts have zero balances.

Correct AnswerverifiedShow Answer

Closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period.

Correct AnswerverifiedShow Answer

Long-term investments can include land held for future expansion.

Correct AnswerverifiedShow Answer

On a work sheet, a loss is indicated if the total of the Income Statement Debit column exceeds the total of the Income Statement Credit column.

Correct AnswerverifiedShow Answer

Closing the temporary accounts at the end of each accounting period does all of the following except:

Correct AnswerverifiedShow Answer

J. Awn, the proprietor of Awn Services, withdrew $8,700 from the business during the current year. The entry to close the withdrawals account at the end of the year is:

Correct AnswerverifiedShow Answer

List and explain the steps in preparing a 10-column worksheet.

Correct Answerverified1. Enter the unadjusted trial balance. L...View AnswerShow Answer

The third closing entry is to close Owner's Capital to the Owner's Withdrawals account.

Correct AnswerverifiedShow Answer

A partially completed work sheet is shown below. The unadjusted trial balance columns are complete. Complete the adjustments, adjusted trial balance, income statement, and balance sheet and statement of changes in equity columns.

Correct AnswerverifiedShow Answer

The adjusted trial balance of the Thomas Company follows: Prepare the closing entries for Thomas Company.

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Use the information in the adjusted trial balance presented below to calculate the current ratio for Jones Company:

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Which of the following statements is incorrect?

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The following information is available for Crandall Company before closing the accounts. After all of the closing entries are made, what will be the balance in the Crandall, Capital account?

Correct AnswerverifiedShow Answer

The Income Summary account is used to close the permanent accounts at the end of an accounting period.

Correct AnswerverifiedShow Answer

The accounting cycle refers to the sequence of steps in preparing the work sheet.

Correct AnswerverifiedShow Answer

Describe a work sheet and explain why it is useful.

Correct AnswerverifiedA work sheet is a useful tool for organi...View AnswerShow Answer

Match the following terms with the appropriate definition.

Correct AnswerverifiedShow Answer

Harry's Bikes' current assets are $400 million and its current liabilities are $250 million. Its current ratio is 0.63.

Correct AnswerverifiedShow Answer

List the steps in the accounting cycle.

Correct AnswerverifiedThe accounting cycle consists of ten ste...View AnswerShow Answer

Accounts that appear in the balance sheet are often called temporary (nominal) accounts.

Correct AnswerverifiedShow Answer

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1. Enter the unadjusted trial balance. L...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A work sheet is a useful tool for organi...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The accounting cycle consists of ten ste...
View Answer

Correct Answer
verified