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Exam 4: The Accounting Cycle

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Question 91

Multiple Choice

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On September 1, the company pays rent for twelve months in advance and debits an asset account. At year end, the adjusting entry on the end-of-period spreadsheet would

A) increase an expense account
B) decrease a liability account
C) increase an asset account
D) decrease an expense account

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Question 92

Multiple Choice

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A net loss appears on the end-of-period spreadsheet in the

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

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Question 93

Multiple Choice

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The post-closing trial balance differs from the adjusted trial balance in that it does not

After all adjustments have been made, but before the accounts have been closed, the following balances were taken from the ledger of Ramona's Designs: Journalize the entries to close the appropriate accounts.

Which of the following is not true about closing entries?

Accrued expenses are ordinarily listed on the balance sheet as current assets.

The amount of the net income for a period appears on both the income statement and the balance sheet for that period.

Which of the accounts below would be closed by posting a debit to the account?

Which one of the steps below is not aided by the preparation of the end-of-period spreadsheet?

Balance sheet accounts are not considered real accounts.

Cross-referencing is useful in assuring that the debits and credits are in balance.

Which of these titles would appear in the Income Statement columns of the end-of-period spreadsheet?

A post-closing trial balance contains only asset and liability accounts.

It is not necessary to post the closing entries to the general ledger.

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

Use this end-of-period spreadsheet to answer the questions that follow.​ -The entry to close the dividends account would be

Working capital is the ratio of the current assets of a business to its current liabilities.

Prepaid Insurance is an example of a current asset.

Unearned revenues that will be earned in a relatively short period of time are listed on the balance sheet as current assets.

Match each journal entry that follows with one of the types of journal entries (a-c) below. -Wages Expense 870 Wages Payable 870 A)Journal entries B)Adjusting journal entries C)Closing journal entries