Question 1

Reversing entries are done when assets or liabilities are increasing and have no previous balance.

Accepted Answer

A) True 
 B)False

Question 2

When closing the expense account, which of the following accounts will also be closed?

Accepted Answer

A)  Rental Income 
B)  Merchandise Inventory 
C)  Sales Returns and Allowances 
D)  Owner's Capital 
A)  Rental Income 
B)  Merchandise Inventory 
C)  Sales Returns and Allowances 
D)  Owner's Capital

Question 3

The post-closing trial balance contains

Accepted Answer

A)  assets and liabilities. 
B)  all accounts with balances. 
C)  only permanent accounts. 
D)  All of these answers are correct. 
A)  assets and liabilities. 
B)  all accounts with balances. 
C)  only permanent accounts. 
D)  All of these answers are correct.

Question 4

To calculate gross profit,

Accepted Answer

A)  subtract Freight-In from net purchases. 
B)  subtract ending inventory from cost of goods available for sale. 
C)  subtract cost of goods sold from net sales. 
D)  add freight to net purchases. 
A)  subtract Freight-In from net purchases. 
B)  subtract ending inventory from cost of goods available for sale. 
C)  subtract cost of goods sold from net sales. 
D)  add freight to net purchases.

Question 5

Which of the following adjustments may be reserved?

Accepted Answer

A)  The adjustment to Record Depreciation Expense 
B)  The adjustment to Allocate Prepaid Insurance to the current period 
C)  The adjustment to Accrue Salaries Payable 
D)  The adjustment to determine Supplies Expense for the period 
A)  The adjustment to Record Depreciation Expense 
B)  The adjustment to Allocate Prepaid Insurance to the current period 
C)  The adjustment to Accrue Salaries Payable 
D)  The adjustment to determine Supplies Expense for the period

Question 6

Plant and equipment are

Accepted Answer

A)  liabilities used to generate net income. 
B)  cash and accounts receivable. 
C)  long-lived assets used in the production or sales of goods or services. 
D)  cash and assets that will be converted or used during the normal operating cycle of the company or one year, whichever is longer. 
A)  liabilities used to generate net income. 
B)  cash and accounts receivable. 
C)  long-lived assets used in the production or sales of goods or services. 
D)  cash and assets that will be converted or used during the normal operating cycle of the company or one year, whichever is longer.

Question 7

The following accounts are on the Balance Sheet section of Marble Company worksheet for the month ended August 31, 2020.
Required: Prepare a classified balance sheet.
 $$\begin{array}{l}
\text { BALANCE SHEET }\
\begin{array} { l c r } 
\text { ACCOUNT } & \text { Debit } & \text { Credit } \
\text { Cash } & 4 & \
\text { Accounts Receivable } & 7 & \
\text { Merchandise Inventory } & 4 & \
\text { Store Equipment } & 12 &  \
\text { Accum. Dep., Store Equip. } & & 4 \
\text { Accounts Payable } & & 5 \
\text { Mortgage Payable } & & 13 \
\text { Appleton. Capital } & & 3\
\hline
\end{array}
\end{array}$$

Accepted Answer

The answer of The following accounts are on the Balance...

Question 8

The following amounts are on the Bear Sporting Goods worksheet for the month ended October 31.
Required: Calculate the following:
a. Net sales
b. Gross profit
c. Operating expenses
d. Other revenue
e. Net income
 $$\begin{array} { l c r } 
\text { Account } &  { \text { Income Statement } } \
& \text { Debit } & \text { Credit } \
\text { Sales } & & 45 \
\text { Sales Returns and Allowances } & 6 & \
\text { Sales Discounts } & 2 & \
\text { Cost of Goods Sold } & 23 & \
\text { Salaries Expense } & 4 & \
\text { Rent Expense } & 3 & \
\text { Depreciation Expense } & 1 & \
\text { Interest Expense } & 1 & \
\text { Interest Revenue } & & 1
\end{array}$$

Accepted Answer

a. $37
b.

Question 9

Which of the following is an operating expense?

Accepted Answer

A)  Salaries Expense 
B)  Payroll Tax Expense 
C)  Interest Expense 
D)  Both A and B are correct. 
A)  Salaries Expense 
B)  Payroll Tax Expense 
C)  Interest Expense 
D)  Both A and B are correct.

Question 10

In what category in a classified balance sheet is Mortgage Payable found?

Accepted Answer

A)  Plant and Equipment 
B)  Current Liabilities 
C)  Long-term Liabilities 
D)  Both B and C are correct. 
A)  Plant and Equipment 
B)  Current Liabilities 
C)  Long-term Liabilities 
D)  Both B and C are correct.

Question 11

The amount for Cost of Goods Sold is found on the worksheet.

Accepted Answer

A) True 
 B)False

Question 12

The entry to record the adjustment for depreciation on equipment would be a debit to Depreciation Expense-Equipment and a credit to Equipment.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is an operating expense?

Accepted Answer

A)  Interest expense 
B)  Interest revenue 
C)  Salaries expense 
D)  Inventory 
A)  Interest expense 
B)  Interest revenue 
C)  Salaries expense 
D)  Inventory

Question 14

Discuss the purpose of a detailed income statement. Briefly describe the major kinds of business activities covered on a detailed income statement.

Accepted Answer

A detailed income statement provides inf

Question 15

The statement of owner's equity ending capital is equal to the capital on the worksheet.

Accepted Answer

A) True 
 B)False

Question 16

Administrative expenses are also called general expenses.

Accepted Answer

A) True 
 B)False

Question 17

Net Sales are

Accepted Answer

A)  Gross Sales + Sales Discounts + Sales Returns and Allowances. 
B)  Gross Sales - Sales Discounts - Sales Returns and Allowances. 
C)  Revenue - Sales Discounts + Sales Returns and Allowances. 
D)  Gross Sales + Sales Discounts - Sales Returns and Allowances. 
A)  Gross Sales + Sales Discounts + Sales Returns and Allowances. 
B)  Gross Sales - Sales Discounts - Sales Returns and Allowances. 
C)  Revenue - Sales Discounts + Sales Returns and Allowances. 
D)  Gross Sales + Sales Discounts - Sales Returns and Allowances.

Question 18

The ending merchandise inventory was overstated. This error would cause

Accepted Answer

A)  net income to be understated. 
B)  assets to be understated. 
C)  net income to be overstated. 
D)  None of these are correct. 
A)  net income to be understated. 
B)  assets to be understated. 
C)  net income to be overstated. 
D)  None of these are correct.

Question 19

Net Sales - Cost of Goods Sold is equal to

Accepted Answer

A)  Net Income from Operations. 
B)  Operating Expenses. 
C)  Gross Profit. 
D)  Gross Expenses. 
A)  Net Income from Operations. 
B)  Operating Expenses. 
C)  Gross Profit. 
D)  Gross Expenses.

Question 20

The following amounts are on the Riley's Clothing worksheet for the month ended March 30.
Required: Calculate the following:
a. Net sales
b. Gross profit
c. Operating expenses
d. Other revenue
e. Net income
 $$\begin{array} { l c r } 
\text { Account } &  { \text { Income Statement } } \
& \text { Debit } & \begin{array} { r } 
\text { Credit }
\end{array} \
\text { Sales } & & 35 \
\text { Sales Returns and Allowances } & 4 & \
\text { Sales Discounts } & 2 & \
\text { Cost of Goods Sold } & 10 & \
\text { Salaries Expense } & 8 & \
\text { Rent Expense } & 5 & \
\text { Depreciation Expense } & 2 & \
\text { Interest Revenue } & &2
\end{array}$$

Accepted Answer

a. $29
b.

Reversing entries are done when assets or liabilities are increasing and have no previous balance.

When closing the expense account, which of the following accounts will also be closed?

The post-closing trial balance contains

To calculate gross profit,

Which of the following adjustments may be reserved?

Plant and equipment are

Which of the following is an operating expense?

In what category in a classified balance sheet is Mortgage Payable found?

The amount for Cost of Goods Sold is found on the worksheet.

The entry to record the adjustment for depreciation on equipment would be a debit to Depreciation Expense-Equipment and a credit to Equipment.

Which of the following is an operating expense?

Discuss the purpose of a detailed income statement. Briefly describe the major kinds of business activities covered on a detailed income statement.

The statement of owner's equity ending capital is equal to the capital on the worksheet.

Administrative expenses are also called general expenses.

Net Sales are

The ending merchandise inventory was overstated. This error would cause

Net Sales - Cost of Goods Sold is equal to

Accounting Concepts and Procedures: an Introduction

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

Banking Procedures and Control of Cash

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Filters

Exam 13: Completion of the Accounting Cycle for a Merchandising Company

Reversing entries are done when assets or liabilities are increasing and have no previous balance.

When closing the expense account, which of the following accounts will also be closed?

The post-closing trial balance contains

To calculate gross profit,

Which of the following adjustments may be reserved?

Plant and equipment are

Which of the following is an operating expense?

In what category in a classified balance sheet is Mortgage Payable found?

The amount for Cost of Goods Sold is found on the worksheet.

The entry to record the adjustment for depreciation on equipment would be a debit to Depreciation Expense-Equipment and a credit to Equipment.

Which of the following is an operating expense?

Discuss the purpose of a detailed income statement. Briefly describe the major kinds of business activities covered on a detailed income statement.

The statement of owner's equity ending capital is equal to the capital on the worksheet.

Administrative expenses are also called general expenses.

Net Sales are

The ending merchandise inventory was overstated. This error would cause

Net Sales - Cost of Goods Sold is equal to

Accounting Concepts and Procedures: an Introduction

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

Banking Procedures and Control of Cash

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Filters