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Study Resources (Accounting)

21) How do you close the expense accounts? A) Debit Capital; credit the expense accounts B) Credit Capital; debit the expense accounts C) Credit Income Summary; debit the expense accounts D) Debit Income Summary; credit the expense accounts 22) All permanent accounts can be found A) on the Income Statement. B) on the Statement of Owner's Equity. C).
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78) Each individual expense account is debited when closing, and the total of all the expense accounts is transferred to Income Summary. 79) The balance in Income Summary after posting all revenues and expenses for the period is equal to net income/loss. 80) A nominal account is the same as a permanent.
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97) A summary of selected ledger accounts appear below for S. Ball for the current calendar year.                                       Answer the following questions. 1. What was the total amount of withdrawals? 2. What was the net income? 3. What was the total revenue? 4. What were the total expenses? 98) On the basis of.
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21) Zach returned $195 of merchandise to Secret Trails. His original purchase was $400, with terms 1/10, n/30. If Justin pays the balance of his account after the discount period, how much should he pay? A) $202.95 B) $205.00 C) $195.00 D) $400.00 22) The arrangements between buyer and seller as to when payments for.
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13) Given the Income Statement columns and the Balance Sheet columns of the worksheet, prepare an income statement for the month ending July 31, 2014 for Foong Company. Income StatementBalance Sheet                  Debit    Credit     Debit    Credit Cash10,000 Account Rec. 2,300 Office Supplies200 T. Foong, Capital11,000 T. Foong, With.500 Repair Fees3,300 Salaries Exp.900 Rent Expense500 Office Sup. Exp.100 Salaries Payable                    200       1,5003,30013,00011,200 1,800       1,800 3,3003,30013,00013,000 .
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71) The worksheet is a formal statement. 72) Adjustments are necessary to update account balances for internal transactions. 73) An important function of the worksheet is to assist the accountant in finding and correcting errors before the financial statements are prepared. 74) The accounts added below the trial balance, on the worksheet, are.
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4.3   The income statement and balance sheet sections of the worksheet. 1) The capital balance amount shown in the balance sheet column of the worksheet represents A) the beginning capital plus net income. B) the beginning capital plus net income less withdrawal. C) the beginning capital less withdrawals. D) the beginning capital plus any investments.
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11) Net sales equal A) gross sales. B) gross sales - sales returns and allowances. C) gross sales - sales returns and allowances - sales discounts. D) sales discounts. 12) The normal balance of the Sales Returns and Allowances account is A) a credit. B) a debit. C) zero. D) It doesn't have a normal balance. 13) The side that.
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4.4   Preparing financial statements from the worksheet. 1) Financial statements are prepared from the A) trial balance. B) worksheet income and balance sheet columns. C) adjusted trial balance. D) ledger. 2) Which of the financial statements is prepared first from the worksheet? A) Balance sheet B) Income statement C) Statement of owner's equity D) None of these answers are correct. 3).
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5.2    Journalizing and posting closing entries. 1) Closing entries are prepared A) to clear all temporary accounts to zero. B) to update the Capital balance. C) at the end of the accounting period. D) All of the above are correct. 2) Income Summary A) is a temporary account. B) is a permanent account. C) summarizes revenue and expenses and.
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31) The Income Summary account shows debits of $17,000 and credits of $12,000. This results in a A) net income of $29,000. B) net loss of $29,000. C) net income of $5,000. D) net loss of $5,000. 32) After closing the revenue, expense, and withdrawal accounts, the capital increased by $3,000. Which of the following.
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9) Show which columns would contain the adjusted balances by placing an "x" in the appropriate column. Assume all accounts have normal balances. Income StatementBalance Sheet DebitCreditDebitCredit Cash (example)_________________x__________ Accounts Receivable____________________________ Office Supplies____________________________ Prepaid Rent____________________________ Word Processing Equipment____________________________ Accounts Payable____________________________ M. Bryant, Capital____________________________ M. Bryant, Withdrawals____________________________ Word Processing Fees____________________________ Office Salaries Expense____________________________ Advertising Expense____________________________ Accumulated Amortization____________________________ Rent Expense____________________________ 10) From the following data, prepare the adjustments.
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19) The ending balances in the ledger after posting the adjusting entries, will be the same amounts that are found on the worksheet in the adjusted trial balance column. 20) After formal financial reports have been prepared, journal entries and posting must be performed before the ledger is updated. 21) Adjusting entries.
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31) Accounts of a single type are kept in this ledger: A) supplemental ledger. B) additional ledger. C) subsidiary ledger. D) None of these answers are correct. 32) When using a subsidiary ledger, the Accounts Receivable account in the general ledger is called the A) master account. B) subsidiary account. C) receivable account. D) controlling account. 33) The principal ledger.
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17) From the following accounts, prepare in proper form a post-closing trial balance for Logan's Pet Sitting on December 31, 2013. (Note: These balances are before closing.) Logan, Capital7,400 Cash2,000 Accumulated Amortization1,500 Equipment5,000 Accounts Payable900 Logan, Withdrawals1,000 Wages Expense2,250 Supplies Expense775 Accounts Receivable3,125 Personal Trainer Fees4,350 18) From the following accounts, prepare in proper form a post-closing trial balance for Matison.
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8) The trial balance prepared after all of the temporary accounts have been closed is called a post-closing trial balance. 9) The Income Summary account can be found on the worksheet. 10) The post-closing trial balance contains the true ending figure for Capital. 11) The post-closing trial balance is used to determine if.
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31) Samantha purchased a one-year insurance policy for $3,600. The adjusting entry for one month would include: A) a debit to Insurance Expense, $300. B) a credit to Cash, $300. C) a debit to Prepaid Insurance, $300. D) a credit to Insurance expense, $300. 32) Sarah's Spices' accrued wages are $1,700. Which of the following.
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83) Use the following information to answer the questions below: Sales$73,400 Sales Discount1,500 Sales Returns and Allowances900 Transportation Expense700 The Net Sales are ________. 84) Compare and discuss a discount period versus a credit period. 85) Determine the amount of net sales given: gross sales = $150,000 sales discounts = $24,000 sales returns and allowances = $40,000 $________________ 86) If cash flow.
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11) Adjusting journal entries are prepared from A) source documents. B) the balance sheet. C) the income statement. D) the adjustments column of the worksheet. 12) Adjusting journal entries A) close the ledger. B) bring accounts up to date. C) are recorded in the ledger. D) are recorded before finishing the worksheet. 13) These entries are prepared and posted to.
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For each of the following identify - in column 1 the category to which the account belongs, in column 2 the normal balance for the account, and in column 3 the financial statement on which the account balance is reported. Column 1Column 2Column 3 88) Sales____________________________________ 89) Professional Fees Earned____________________________________ 90) Sales Returns and.
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5) Given the income statement columns and the balance sheet columns of the worksheet, prepare an income statement for the month of October 31, 2014, for the company. TrialAdjustedIncomeBalance BalanceAdjustmentsTrial BalanceStatement Sheet Accounts DR CR DR CR DR CR DR CR DR CR Cash 1,000 1,000 1,000 Accts. Rec. 400 400 400 Supplies 900 c  400 500 500 Equipment 750 750 750 Accts. Pay 700 700 700 Capital 1,950 1,950 1,950 Withdrawls 200 200 200 Fees Earned 900 900 900 Salary Exp.   300 b  100 400 400 Totals 3,550 3,550 Amortization Expense a   50 50 50 Accumulated Amortization a    50 50 50 Salaries Payable b  100 100 100 Supplies Expense c  400 400 400 Totals 550 550 3,700 3,700 850 900 2,850 2,800 Net Loss 50 50 900 900 2,850 2,850 6) Given the income statement columns and the balance.
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  6.1   Recording and posting sales transactions. 1) Merchants who buy goods from wholesalers for resale to customers are A) merchandisers. B) retailers. C) service companies. D) None of the above are correct. 2) Merchandise is A) the same as inventory. B) an asset. C) the same as gross sales. D) both A and B are correct. 3) Gross sales equals A) net.
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51) Historical cost is the same as A) residual value. B) original cost. C) accumulated amortization. D) book value. 52) The accrual of an expense was not recorded. This would A) overstate expenses and overstate liabilities. B) overstate expenses and understate liabilities. C) understate expenses and overstate liabilities. D) understate expenses and understate liabilities. 53) Amortization of equipment was recorded.
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81) The original cost of equipment is reduced by the amount of Amortization Expense. 82) The spreading or allocating of the cost of a long-term asset is called amortization. 83) Accumulated Amortization is an asset account. 84) The worksheet contains a trial balance. 85) Amortization Expense is debited when recording the amortization for the.
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93) In the first space below, indicate whether each account is a real or nominal account using (R) Real Account and (N) Nominal Account. In the second space below, indicate by an (X) if the account should be closed. N X0. Advertising Expense ______  ______ 1. Prepaid Insurance ______  ______ 2. Service Fees ______ .
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41) Bailey's received its electric bill for December on December 31 but did not pay nor record it in the general journal. This resulted in A) understated assets. B) overstated net income. C) overstated liabilities. D) understated capital. 42) Online Service received its telephone bill for January, but is not going to pay the bill.
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63) When a customer returns defective office supplies the Sales Returns and Allowances account will be debited. 64) Sales Returns and Allowances is a contra-revenue account with a normal credit balance. 65) The credit period is longer than the discount period. 66) An example of a subsidiary ledger is the accounts receivable ledger. 67).
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11) The correct order for closing accounts is: A) revenue, expenses, income summary, withdrawals. B) revenue, income summary, expenses, withdrawals. C) revenue, expenses, capital, withdrawals. D) revenue, capital, expenses, withdrawals. 12) To close the Fees Earned account, A) debit Income Summary; credit Fees Earned. B) debit Fees Earned; credit Capital. C) debit Fees Earned; credit Income Summary. D) debit.
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51) The revenue accounts debited and the Income Summary account credited would be the result of A) closing the Income Summary account - there is a net income. B) closing the Income Summary account - there is a net loss. C) closing the revenue accounts. D) closing the expense accounts. 52) When closing the Income.
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100) Determine the ending owner's equity of a business having a beginning owner's equity of $4,300, withdrawals of $1,500, and after closing the revenues and expenses Income Summary has a credit balance of $4,750. $________________ 101) Determine the beginning owner's equity of a business having an ending owner's equity of $6,200, withdrawals.
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  5.1    Journalizing and posting adjusting entries. 1) Adjusting journal entries A) need not be journalized since they appear on the worksheet. B) need not be posted if the financial statements are prepared from the worksheet. C) are not needed if closing entries are prepared. D) must be journalized and posted. 2) Journal entries that are needed.
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68) There are 4 closing entries. 69) The Withdrawals account is closed to Income Summary. 70) The Withdrawals account is closed to the Owner's Capital account. 71) Real accounts are those accounts with balances that are brought forward to the next accounting period. 72) Nominal accounts are called temporary accounts because their balances are.
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95) From the following items in the income statement columns of the worksheet of Friend's Tutoring at December 31, prepare the closing entries without explanation, assuming that a $1,500 withdrawal was made during the period. Income Statement Account Debit Credit Tutoring Fees3,450 Wages Expense700 Rent Expense600 Supplies Expense450 Insurance Expense    250_____ 2,000 3,450 Net Income1,450 _____ $3,450 $3,450 96) From.
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61) A temporary account in the ledger used for closing revenues and expenses is A) capital. B) withdrawals. C) income summary. D) net income. 62) The purpose of closing entries is to A) adjust the accounts in the ledger. B) set nominal account balances to zero to begin the next period. C) set real account balances to zero.
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17) From the following data, make the following adjustments, and complete the worksheet for the month. (a) Amortization Expense is $250. (b) Supplies available $250, supplies on hand $75. (c) Prepaid Insurance balance $400, $100 has expired. (d) Wages for the 5-day work-week are $500, the month ended on a Wednesday. DR CR DR CR DR CR DR CR DR CR Cash 750 Accts. Receivable 400 Supplies 250 Prepaid Ins. 400 Equipment 7,000 Accts. Payable 900 Capital 7,100 Fees.
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15) For each account listed identify the category it belongs to, the normal balance (debit or credit), and the financial statement the account appears. Account Category Normal Balance Financial Statement 0.  Cash Asset Debit Balance Sheet 1.  Amortization Expense 2.  Accumulated Amortization 3 Wages Expense 4.  Office Supplies 5.  Office Supplies Expense 6.  Wages Payable 7.  Prepaid Rent 16) For each account listed, identify the.
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4.2   Preparation of adjusted trial balance on the worksheet. 1) The order of the steps to prepare the worksheet are: A) prepare the trial balance, complete adjustments, prepare the adjusted trial balance, extend the respective totals to the Income Statement and Balance Sheet columns. B) complete the adjustments, prepare the adjusted trial balance,.
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5.3    Preparing a post-closing trial balance. 1) The final step in the accounting cycle is A) preparing the post-closing trial balance. B) preparing the financial statements. C) journalizing the closing entries. D) journalizing the adjusting entries. 2) Which of the following sequence of actions describes the proper order in the accounting cycle? A) Journalize, post, close, prepare.
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100) What is the purpose of adjusting entries? Discuss the effect of not preparing adjusting entries on various accounts. 101) What are the differences between amortization expense and accumulated amortization? 102) Equipment was purchased for $20,000, residual value is $1,000 and it is expected that the useful life is 10 years. What.
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