Question 1

The post-closing trial balance will generally have fewer accounts than the trial balance.

Accepted Answer

A) True 
 B)False

Question 2

Journalizing and posting the adjustments and closing entries updates the ledger for the new accounting period.

Accepted Answer

A) True 
 B)False

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

Use the information in the adjusted trial balance for Stockton Company to answer the questions that follow.  
 Determine the net income (loss) for the period.

Accepted Answer

A)  Net Income $9,250 
B)  Net Loss $790 
C)  Net Loss $5,670 
D)  Net Income $3,580 
A)  Net Income $9,250 
B)  Net Loss $790 
C)  Net Loss $5,670 
D)  Net Income $3,580

Question 5

Amir Designs purchased a one-year liability insurance policy on March 1st of this year for $7,200 and recorded it as a prepaid expense. Which of the following amounts would be recorded for insurance expense during the adjusting process at the end of Amir's first month of operations on March 31st?

Accepted Answer

A)  $7,200 
B)  $720 
C)  $600 
D)  $6,600 
A)  $7,200 
B)  $720 
C)  $600 
D)  $6,600

Question 6

Which of the accounts below would appear in the Balance Sheet columns of the work sheet?

Accepted Answer

A)  Service Revenue 
B)  Prepaid Rent 
C)  Supplies Expense 
D)  None are correct 
A)  Service Revenue 
B)  Prepaid Rent 
C)  Supplies Expense 
D)  None are correct

Question 7

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 
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 8

The following revenue and expense account balances were taken from the Income Statement columns of the work sheet for Fraser Services Co. for the year ended December 31, 2011:
   Prepare an income statement.

Accepted Answer

The answer of The following revenue and expense account balances...

Question 9

The usual presentation of the retained earnings statement is (1) beginning retained earnings, (2) net income or loss, (3) dividends (4) ending retained earnings.

Accepted Answer

A) True 
 B)False

Question 10

A net loss appears on the work sheet in the

Accepted Answer

A)  debit column of the Balance Sheet columns 
B)  credit column of the Balance Sheet columns 
C)  debit column of the Income Statement columns 
D)  credit column of the Adjustments columns 
A)  debit column of the Balance Sheet columns 
B)  credit column of the Balance Sheet columns 
C)  debit column of the Income Statement columns 
D)  credit column of the Adjustments columns

Question 11

The balances for the accounts listed below appeared in the Adjusted Trial Balance columns of the work sheet. Indicate whether each balance should be extended to (a) the Income Statement columns or (b) the Balance Sheet columns.

Accepted Answer

The answer of The balances for the accounts listed below...

Question 12

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

Accepted Answer

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

Question 13

Beachside Realty rents condominiums and furnishings. It's adjusted trial balance at December 31, 2011, is as follows:
   Prepare the entry required to close the revenue accounts at the end of the period.

Accepted Answer

The answer of Beachside Realty rents condominiums and furnishings. It's...

Question 14

Which item would appear in the Income Statement columns of the work sheet?

Accepted Answer

A)  Equipment 
B)  Unearned Fees 
C)  Prepaid Expense 
D)  Net Loss 
A)  Equipment 
B)  Unearned Fees 
C)  Prepaid Expense 
D)  Net Loss

Question 15

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

Accepted Answer

A)  Wages Expense 63,000 Rent Expense 27,000
Depreciation Expense 15,000
Income Summary 105,000 
B)  Expenses 105,000 Income Summary 105,000 
C)  Wages Expense 63,000 Rent Expense 27,000
Depreciation Expense 15,000
Dividends 105,000 
D)  Income Summary 105,000 Wages Expense 63,000
Rent Expense 27,000
Depreciation Expense 15,000 
A)  Wages Expense 63,000 Rent Expense 27,000
Depreciation Expense 15,000
Income Summary 105,000 
B)  Expenses 105,000 Income Summary 105,000 
C)  Wages Expense 63,000 Rent Expense 27,000
Depreciation Expense 15,000
Dividends 105,000 
D)  Income Summary 105,000 Wages Expense 63,000
Rent Expense 27,000
Depreciation Expense 15,000

Question 16

Any twelve-month accounting period adopted by a company is known as its fiscal year.

Accepted Answer

A) True 
 B)False

Question 17

The totals of the Adjusted Trial Balance columns on a work sheet will always be the sum of the Trial Balance column totals and the Adjustments column totals.

Accepted Answer

A) True 
 B)False

Question 18

Prepaid insurance is reported on the balance sheet as a

Accepted Answer

A)  current asset 
B)  fixed asset 
C)  current liability 
D)  long-term liability 
A)  current asset 
B)  fixed asset 
C)  current liability 
D)  long-term liability

Question 19

The accounting cycle begins with preparing an unadjusted trial balance.

Accepted Answer

A) True 
 B)False

Question 20

There is really  no benefit in preparing financial statements in any particular order.

Accepted Answer

A) True 
 B)False

Exam 4: Completing the Accounting Cycle

The post-closing trial balance will generally have fewer accounts than the trial balance.

Journalizing and posting the adjustments and closing entries updates the ledger for the new accounting period.

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

Use the information in the adjusted trial balance for Stockton Company to answer the questions that follow. Determine the net income (loss) for the period.

Amir Designs purchased a one-year liability insurance policy on March 1st of this year for $7,200 and recorded it as a prepaid expense. Which of the following amounts would be recorded for insurance expense during the adjusting process at the end of Amir's first month of operations on March 31st?

Which of the accounts below would appear in the Balance Sheet columns of the work sheet?

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

The following revenue and expense account balances were taken from the Income Statement columns of the work sheet for Fraser Services Co. for the year ended December 31, 2011: Prepare an income statement.

The usual presentation of the retained earnings statement is (1) beginning retained earnings, (2) net income or loss, (3) dividends (4) ending retained earnings.

A net loss appears on the work sheet in the

The balances for the accounts listed below appeared in the Adjusted Trial Balance columns of the work sheet. Indicate whether each balance should be extended to (a) the Income Statement columns or (b) the Balance Sheet columns.

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

Beachside Realty rents condominiums and furnishings. It's adjusted trial balance at December 31, 2011, is as follows: Prepare the entry required to close the revenue accounts at the end of the period.

Which item would appear in the Income Statement columns of the work sheet?

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

Any twelve-month accounting period adopted by a company is known as its fiscal year.

The totals of the Adjusted Trial Balance columns on a work sheet will always be the sum of the Trial Balance column totals and the Adjustments column totals.

Prepaid insurance is reported on the balance sheet as a

The accounting cycle begins with preparing an unadjusted trial balance.

There is really no benefit in preparing financial statements in any particular order.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

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