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38. The information for preparing a trial balance on a work sheet is obtained from
b. general ledger accounts.
39. After the adjusting entries are journalized and posted to the accounts in the
general ledger, the balance of each account should agree with the balance shown on
the
a. adjusted trial balance.
40. If the total debit column exceeds the total credit column of the income
statement columns on a work sheet, then the company has
c. suffered a net loss for the period.
42. Which of the following companies would be least likely to use a work sheet to
facilitate the adjustment process?
d. Small company with few accounts
44.The account, Supplies, will appear in the following debit columns of the work
sheet.
d. All of these
45.When constructing a work sheet, accounts are often needed that are not listed in
the trial balance already entered on the work sheet from the ledger. Where should
these additional accounts be shown on the work sheet?
c. They should be inserted on the lines immediately below the trial
balance totals.
47. Assuming that there is a net loss for the period, debits equal credits in all but
which section of the work sheet?
a. Income statement columns
51.If the total debits exceed total credits in the balance sheet columns of the work
sheet, owner's equity
d. will not be affected.
Use the following information for questions 52–53.
The income statement and balance sheet columns of Pine Company's work sheet
reflects the following totals:
53. To enter the net income (or loss) for the period into the above work sheet
requires an entry to the
d. balance sheet debit column and to the balance sheet credit column.
57. If Income Summary has a credit balance after revenues and expenses have
been closed into it, the closing entry for Income Summary will include a
c. credit to the owner's capital account.
60. Which of the following is a true statement about closing the books of a
proprietorship?
c. Revenues and expenses are closed to the Income Summary
account.
61. Closing entries may be prepared from all but which one of the following
sources?
c. Balance sheet
d. credit the income summary account for total revenues and debit the
income summary account for total expenses.
65. The closing entry process consists of closing
d. all temporary accounts.
66. The final closing entry to be journalized is typically the entry that closes the
b. owner's drawing account.
69. The balance in the income summary account before it is closed will be equal
to
a. the net income or loss on the income statement.
70. After closing entries are posted, the balance in the owner's capital account in
the ledger will be equal to
b. the amount of the owner's capital reported on the balance sheet.
75. The balances that appear on the post-closing trial balance will match the
b. balance sheet account balances after closing entries.
76. Which account listed below would be double ruled in the ledger as part of the
closing process?
c. Owner's Drawing
77. A double rule applied to accounts in the ledger during the closing process
implies that
a. the account is an income statement account.
78. The heading for a post-closing trial balance has a date line that is similar to
the one found on
a. a balance sheet.
79. Which one of the following is an optional step in the accounting cycle of a
business enterprise?
b. Prepare a work sheet
81. Which of the following steps in the accounting cycle would not generally be
performed daily?
c. Prepare adjusting entries
82. Which of the following steps in the accounting cycle may be performed more
frequently than annually?
d. Prepare a trial balance
83. Which of the following depicts the proper sequence of steps in the accounting
cycle?
c. Prepare a trial balance, prepare adjusting entries, prepare financial
statements
84. The two optional steps in the accounting cycle are preparing
c. reversing entries and a work sheet.
86. Speedy Bike Company received a $640 check from a customer for the
balance due. The transaction was erroneously recorded as a debit to Cash
$460 and a credit to Service Revenue $460. The correcting entry is
90. Cole Company paid the weekly payroll on January 2 by debiting Wages
Expense for $50,000. The accountant preparing the payroll entry overlooked
the fact that Wages Expense of $40,000 had been accrued at year end on
December 31. The correcting entry is
c. Wages Payable .................................................................. 40,000
Wages Expense .....................................................
40,000
91. Tyler Company paid $430 on account to a creditor. The transaction was
erroneously recorded as a debit to Cash of $340 and a credit to Accounts
Receivable, $340. The correcting entry is
98. Which of the following liabilities are not related to the operating cycle?
d. Bonds payable
100. It is not true that current assets are resources that are expected to be
d. acquired within one year.
101. The operating cycle of a company is the average time that is required to go
from cash to
b. cash in producing revenues.
104. The relationship between current assets and current liabilities is important in
evaluating a company's
b. liquidity.
105. The most important information needed to determine if companies can pay
their current obligations is the
c. relationship between current assets and current liabilities.
a
106. A reversing entry
b. is the exact opposite of an adjusting entry made in a previous
period.
a
107. If a company utilizes reversing entries, they will
a. be made at the beginning of the next accounting period.
s
109. Balance sheet accounts are considered to be
b. permanent accounts.
s
110. Income Summary has a credit balance of $12,000 in J. Spencer` Co. after
closing revenues and expenses. The entry to close Income Summary is
s
113. On September 23, the Polar Company received a $350 check from Mike
Moluf for services to be performed in the future. The bookkeeper for Polar
Company incorrectly debited Cash for $350 and credited Accounts
Receivable for $350. The amounts have been posted to the ledger. To
correct this entry, the bookkeeper should
b. debit Accounts Receivable $350 and credit Unearned Service
Revenue $350.
s
114. Current liabilities
a. must reasonably be expected to be paid from existing current assets
or through the creation of other current liabilities.