Question 1

Which of the following accounts will have an ending balance after the closing process is completed?

Accepted Answer

A) Owner's Name, Withdrawals 
B) Rent Expense 
C) Accumulated Depreciation-Furniture 
D) Service Revenue 
A) Owner's Name, Withdrawals 
B) Rent Expense 
C) Accumulated Depreciation-Furniture 
D) Service Revenue

Question 2

Which of the following are NOT included in a post-closing trial balance?

Accepted Answer

A) Assets and liabilities 
B) Capital and assets 
C) Capital and liabilities 
D) Revenues and expenses 
A) Assets and liabilities 
B) Capital and assets 
C) Capital and liabilities 
D) Revenues and expenses

Question 3

The operating cycle is the time span required for a business to repay its long-term liabilities.

Accepted Answer

A) True 
 B)False

Question 4

In the balance sheet, assets are classified as either current or long-term depending on their liquidity.

Accepted Answer

A) True 
 B)False

Question 5

Buildings, land, and equipment are classified as:

Accepted Answer

A) current assets. 
B) long-term assets. 
C) current liabilities. 
D) long-term liabilities. 
A) current assets. 
B) long-term assets. 
C) current liabilities. 
D) long-term liabilities.

Question 6

Your Best Advisors, a service company, uses reversing entries. On March 31, 2014, they prepared the following adjusting entry to accrue Utilities Expense:   Which of the following entries is the correct reversing entry to be prepared on April 1, 2014?

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 7

The current ratio shows the profitability of a firm.

Accepted Answer

A) True 
 B)False

Question 8

An increase in the current ratio implies that the profitability of the company has increased from the previous period.

Accepted Answer

A) True 
 B)False

Question 9

The Prepaid Rent in the worksheet's unadjusted trial balance column is $4,000. Prepaid Rent in the balance sheet column is $2,000. Which of the following entries would have caused this difference?

Accepted Answer

A) A $2,000 debit entry to Prepaid Rent in the worksheet's adjustments column 
B) A $2,000 credit entry to Rent Expense in the worksheet's adjustments column 
C) A $2,000 credit entry to Prepaid Rent in the worksheet's adjustments column 
D) A $2,000 debit entry to Cash in the worksheet's adjustments column 
A) A $2,000 debit entry to Prepaid Rent in the worksheet's adjustments column 
B) A $2,000 credit entry to Rent Expense in the worksheet's adjustments column 
C) A $2,000 credit entry to Prepaid Rent in the worksheet's adjustments column 
D) A $2,000 debit entry to Cash in the worksheet's adjustments column

Question 10

Which of the following statements is true of the worksheet?

Accepted Answer

A) The Net Income is recorded in the income statement credit column. 
B) The Net Income is recorded in the adjusted trial balance debit column. 
C) The Net Income is recorded in the income statement debit column. 
D) The Net Income is recorded in the balance sheet debit column. 
A) The Net Income is recorded in the income statement credit column. 
B) The Net Income is recorded in the adjusted trial balance debit column. 
C) The Net Income is recorded in the income statement debit column. 
D) The Net Income is recorded in the balance sheet debit column.

Question 11

Which of the following entries will be necessary to close the appropriate depreciation account at the end of the year?

Accepted Answer

A) Debit Accumulated Depreciation and credit Income Summary 
B) Debit Depreciation Expense and credit Income Summary 
C) Debit Income Summary and credit Accumulated Depreciation 
D) Debit Income Summary and credit Depreciation Expense 
A) Debit Accumulated Depreciation and credit Income Summary 
B) Debit Depreciation Expense and credit Income Summary 
C) Debit Income Summary and credit Accumulated Depreciation 
D) Debit Income Summary and credit Depreciation Expense

Question 12

The Accumulated Depreciation account is a permanent account.

Accepted Answer

A) True 
 B)False

Question 13

The Owner's Name, Capital account is a temporary account.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following steps must be completed before preparing the adjusted trial balance?

Accepted Answer

A) Prepare post-closing trial balance.0 
B) Post journal entries to the accounts. 
C) Prepare closing entries. 
D) Prepare the financial statements. 
A) Prepare post-closing trial balance.0 
B) Post journal entries to the accounts. 
C) Prepare closing entries. 
D) Prepare the financial statements.

Question 15

The amount of the Owner's Name, Withdrawals account is entered in the income statement columns on the worksheet.

Accepted Answer

A) True 
 B)False

Question 16

The entries that transfer the revenue, expense, and withdrawal balances to the Owner's Name, Capital account to set these balances to zero for the next period are called:

Accepted Answer

A) closing entries. 
B) opening entries. 
C) adjusting entries. 
D) temporary accounts. 
A) closing entries. 
B) opening entries. 
C) adjusting entries. 
D) temporary accounts.

Exam 4: Completing the Accounting Cycle

Which of the following accounts will have an ending balance after the closing process is completed?

Which of the following are NOT included in a post-closing trial balance?

The operating cycle is the time span required for a business to repay its long-term liabilities.

In the balance sheet, assets are classified as either current or long-term depending on their liquidity.

Buildings, land, and equipment are classified as:

Your Best Advisors, a service company, uses reversing entries. On March 31, 2014, they prepared the following adjusting entry to accrue Utilities Expense: Which of the following entries is the correct reversing entry to be prepared on April 1, 2014?

The current ratio shows the profitability of a firm.

An increase in the current ratio implies that the profitability of the company has increased from the previous period.

The Prepaid Rent in the worksheet's unadjusted trial balance column is $4,000. Prepaid Rent in the balance sheet column is $2,000. Which of the following entries would have caused this difference?

Which of the following statements is true of the worksheet?

Which of the following entries will be necessary to close the appropriate depreciation account at the end of the year?

The Accumulated Depreciation account is a permanent account.

The Owner's Name, Capital account is a temporary account.

Which of the following steps must be completed before preparing the adjusted trial balance?

The amount of the Owner's Name, Withdrawals account is entered in the income statement columns on the worksheet.

The entries that transfer the revenue, expense, and withdrawal balances to the Owner's Name, Capital account to set these balances to zero for the next period are called:

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

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