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Exam 4: Completing the Accounting Cycle

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Question 41

Multiple Choice

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Which of the following is not true about closing entries?

A) There are four closing entries that update the owner's equity account.
B) After the second closing entry, the income summary account is equal to the net income or (loss) for the period.
C) All real accounts are closed at the end of the period.
D) By closing nominal accounts at the end of the period to zero, it is possible to isolate next period's information correctly.

E) B) and D)
F) None of the above

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Question 42

Multiple Choice

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

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

E) B) and C)
F) None of the above

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Question 43

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The income summary account is also called

Which of the items below does not appear on the work sheet?

Use the following worksheet to answer the following questions. Based on the preceding trial balance, the entry to close income summary would be:

The balance sheet accounts are referred to as real or permanent accounts.

Which one of the fixed asset accounts listed below will not have a related contra asset account?

The income statement is prepared from the adjusted trial balance or the income statement columns on the work sheet.

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.

Morgan Olsen owns and operates Crystal Pool Service Company. On January 1, 2014, Morgan Olsen, Capital had a balance of $252,000. During the year Morgan invested an additional $32,000 and withdrew $52,400. For the year ended December 31, 2014 Crystal Pool Service Company reported a net income of $73,200. Prepare a Statement of Owner's Equity for the year ended December 31, 2014.

Identify which of the following accounts should be closed with a debit or a credit to Income Summary at the end of the fiscal year. If it is not closed to Income Summary, mark as n/a. 1. Utilities Payable 2. Utilities Expense 3. Supplies 4. Supplies Expense 5. Fees Earned 6. Unearned Fees 7. Accounts Receivable 8. Jason Hill, Drawing 9. Jason Hill, Capital 10. Accumulated Depreciation - Equipment 11. Depreciation Expense - Equipment 12. Equipment 13. Prepaid Insurance 14. Insurance Expense

Prepare closing entries from the following work sheet. Lakendra Enterprises Worksheet For the Year Ended December 31, 2010

A summary of selected ledger accounts appear below for Alberto's Plumbing Services for the current calendar year end. Net income for the period is

The usual presentation of the statement of owner's equity is (1) Beginning capital, (2) Net income or loss, (3) Drawing, (4) Owner's contributions, (5) Ending capital.

Real accounts are permanent accounts.

After analyzing transactions, the next step would be to post the transactions in the ledger.

After all of the account balances have been extended to the Income Statement columns of the work sheet, the totals of the debit and credit columns are $77,500 and $83,900, respectively. What is the amount of the net income or net loss for the period?

Balance sheet accounts

The classified Balance Sheet will subsection the assets section as follows

The trial balance may be listed on the work sheet instead of being prepared separately.