Question 1

Two common subgroups for liabilities on a classified balance sheet are:

Accepted Answer

A)   current liabilities and intangible liabilities.
B)   present liabilities and operating liabilities.
C)   general liabilities and specific liabilities.
D)   intangible liabilities and long-term liabilities.
E)   current liabilities and long-term liabilities.F) A) and C)
G) D) and E)

Question 2

Describe a work sheet and explain why it is useful.

Accepted Answer

A work sheet is a useful tool for organi...

Question 3

Revenues, expenses, and withdrawals accounts, which are closed at the end of each accounting period are:

Accepted Answer

A)   Real accounts.
B)   Temporary accounts.
C)   Closing accounts.
D)   Permanent accounts.
E)   Balance sheet accounts.F) C) and D)
G) B) and E)

Question 4

Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense accounts, and the withdrawals account to owner's capital.

Accepted Answer

A) True 
 B)False

Question 5

The following adjusted trial balance is for Clara Co. at year-end December 31. The credit balance in Clara, Capital at the beginning of the year, January 1, was $320,000. The owner, Sara Clara, invested an additional $100,000 during the current year. The land held for future expansion was also purchased during the current year.

Accepted Answer

Required:
Prepare a classifie...

Question 6

Closing entries are required:

Accepted Answer

A)   if management has decided to cease operating the business.
B)   only if the company adheres to the accrual method of accounting.
C)   if a company's bookkeeper forgets to prepare reversing entries.
D)   if the temporary accounts are to reflect correct amounts for each accounting period.
E)   in order to satisfy the Internal Revenue Service.F) All of the above
G) A) and E)

Question 7

A partially completed work sheet is shown below. The unadjusted trial balance columns are complete. Complete the adjustments, adjusted trial balance, income statement, and balance sheet and statement of owner's equity columns.

Accepted Answer

The answer of A partially completed work sheet is shown...

Question 8

Reversing entries:

Accepted Answer

A)   are necessary when journal entries have been incorrectly recorded.
B)   are a required step in the accounting cycle.
C)   will often result in abnormal account balances in some accounts.
D)   are required only if the company uses accounting software to record journal entries.
E)   must be made before preparing the post-closing trial balance.F) A) and B)
G) A) and C)

Question 9

A columnar working paper used to prepare a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements, and which is an optional tool in the accounting process is a(n) :

Accepted Answer

A)   Adjusted trial balance.
B)   Work sheet.
C)   Post-closing trial balance.
D)   Unadjusted trial balance.
E)   General ledger.F) B) and E)
G) C) and D)

Question 10

All necessary numbers to prepare the income statement can be taken from the income statement columns of the work sheet, including the net income or net loss.

Accepted Answer

A) True 
 B)False

Question 11

Assets are often classified into current assets, long-term investments, plant assets, and intangible assets.

Accepted Answer

A) True 
 B)False

Question 12

Plant assets are usually listed in order from most liquid to least liquid.

Accepted Answer

A) True 
 B)False

Question 13

A work sheet is a substitute for the set of financial statements.

Accepted Answer

A) True 
 B)False

Question 14

J. Awn, the proprietor of Awn Services, withdrew $8,700 from the business during the current year. The entry to close the withdrawals account at the end of the year is:

Accepted Answer

A)   Debit J. Awn, Withdrawals $8,700; credit Cash, $8,700
B)   Debit J. Awn, Capital $8,700; credit J. Awn, Withdrawals $8,700
C)   Debit J. Awn, Withdrawals $8,700; credit J. Awn, Capital $8,700
D)   Debit J. Awn, Capital $8,700, credit Salary Expense $8,700
E)   Debit Income Summary $8,700; credit J. Awn, Capital $8,700F) None of the above
G) A) and E)

Question 15

Closing entries are necessary so that owner's capital will begin each period with a zero balance.

Accepted Answer

A) True 
 B)False

Question 16

If the Balance Sheet and Statement of Owner's Equity columns of a work sheet fail to balance when the amount of the net income is added to the Balance Sheet and Statement of Owner's Equity Credit column, the cause could be:

Accepted Answer

A)   An expense amount entered in the Balance Sheet and Statement of Owner's Equity Debit column.
B)   A revenue amount entered in the Balance Sheet and Statement of Owner's Equity Credit column.
C)   An asset amount entered in the Income Statement and Statement of Owner's Equity Debit column.
D)   A liability amount entered in the Income Statement and Statement of Owner's Equity Credit column.
E)   An expense amount entered in the Balance Sheet and Statement of Owner's Equity Credit column.F) A) and B)
G) A) and C)

Question 17

Which of the following statements regarding reporting under GAAP and IFRS is not true?

Accepted Answer

A)   Both GAAP and IFRS define the initial asset value as historical cost for nearly all assets.
B)   The definition of an asset under GAAP and IFRS involves three basic criteria.
C)   Both GAAP and IFRS define the initial asset value as replacement value.
D)   The definition of a liability under GAAP and IFRS involves three basic criteria.
E)   After acquisition, one of two asset measurement systems is applied.F) A) and E)
G) B) and C)

Question 18

Reversing entries are linked to ____________________ and _____________ that were created by adjusting entries at the end of the prior accounting period.
________________________________________

Accepted Answer

Chapter 04 Completin...

Question 19

Current liabilities include accounts receivable, unearned revenues, and salaries payable.

Accepted Answer

A) True 
 B)False

Question 20

The current ratio:

Accepted Answer

A)   Is used to measure a company's profitability.
B)   Is used to measure the relation between assets and long-term debt.
C)   Measures the effect of operating income on profit.
D)   Is used to help evaluate a company's ability to pay its debts in the near future.
E)   Is calculated by dividing current assets by equity.F) A) and B)
G) A) and C)

Exam 4: Completing the Accounting Cycle

Closing entries are necessary so that owner's capital will begin each period with a zero balance.

Correct Answer
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Reversing entries are linked to ______________ and _ that were created by adjusting entries at the end of the prior accounting period. __________________________________

Correct Answer
verified
Chapter 04 Completin...
View Answer

If the Balance Sheet and Statement of Owner's Equity columns of a work sheet fail to balance when the amount of the net income is added to the Balance Sheet and Statement of Owner's Equity Credit column, the cause could be:

Correct Answer
verified

A columnar working paper used to prepare a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements, and which is an optional tool in the accounting process is a(n) :

Correct Answer
verified

Plant assets are usually listed in order from most liquid to least liquid.

Correct Answer
verified

Which of the following statements regarding reporting under GAAP and IFRS is not true?

Correct Answer
verified

The current ratio:

Correct Answer
verified

A work sheet is a substitute for the set of financial statements.

Correct Answer
verified

Reversing entries:

Correct Answer
verified

Correct Answer
verified
Required:
Prepare a classifie...
View Answer

Closing entries are required:

Correct Answer
verified

Describe a work sheet and explain why it is useful.

Correct Answer
verified
A work sheet is a useful tool for organi...
View Answer

J. Awn, the proprietor of Awn Services, withdrew $8,700 from the business during the current year. The entry to close the withdrawals account at the end of the year is:

Correct Answer
verified

All necessary numbers to prepare the income statement can be taken from the income statement columns of the work sheet, including the net income or net loss.

Correct Answer
verified

Assets are often classified into current assets, long-term investments, plant assets, and intangible assets.

Correct Answer
verified

A partially completed work sheet is shown below. The unadjusted trial balance columns are complete. Complete the adjustments, adjusted trial balance, income statement, and balance sheet and statement of owner's equity columns.

Correct Answer
verified

Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense accounts, and the withdrawals account to owner's capital.

Correct Answer
verified

Two common subgroups for liabilities on a classified balance sheet are:

Correct Answer
verified

Revenues, expenses, and withdrawals accounts, which are closed at the end of each accounting period are:

Correct Answer
verified

Current liabilities include accounts receivable, unearned revenues, and salaries payable.

Correct Answer
verified

Exam 4: Completing the Accounting Cycle

Closing entries are necessary so that owner's capital will begin each period with a zero balance.

Correct AnswerverifiedShow Answer

Reversing entries are linked to ____________________ and _____________ that were created by adjusting entries at the end of the prior accounting period. ________________________________________

Correct AnswerverifiedChapter 04 Completin...View AnswerShow Answer

If the Balance Sheet and Statement of Owner's Equity columns of a work sheet fail to balance when the amount of the net income is added to the Balance Sheet and Statement of Owner's Equity Credit column, the cause could be:

Correct AnswerverifiedShow Answer

A columnar working paper used to prepare a company's unadjusted trial balance, adjusting entries, adjusted trial balance, and financial statements, and which is an optional tool in the accounting process is a(n) :

Correct AnswerverifiedShow Answer

Plant assets are usually listed in order from most liquid to least liquid.

Correct AnswerverifiedShow Answer

Which of the following statements regarding reporting under GAAP and IFRS is not true?

Correct AnswerverifiedShow Answer

The current ratio:

Correct AnswerverifiedShow Answer

A work sheet is a substitute for the set of financial statements.

Correct AnswerverifiedShow Answer

Reversing entries:

Correct AnswerverifiedShow Answer

Correct Answerverified Required:Prepare a classifie...View AnswerShow Answer

Closing entries are required:

Correct AnswerverifiedShow Answer

Describe a work sheet and explain why it is useful.

Correct AnswerverifiedA work sheet is a useful tool for organi...View AnswerShow Answer

J. Awn, the proprietor of Awn Services, withdrew $8,700 from the business during the current year. The entry to close the withdrawals account at the end of the year is:

Correct AnswerverifiedShow Answer

All necessary numbers to prepare the income statement can be taken from the income statement columns of the work sheet, including the net income or net loss.

Correct AnswerverifiedShow Answer

Assets are often classified into current assets, long-term investments, plant assets, and intangible assets.

Correct AnswerverifiedShow Answer

A partially completed work sheet is shown below. The unadjusted trial balance columns are complete. Complete the adjustments, adjusted trial balance, income statement, and balance sheet and statement of owner's equity columns.

Correct AnswerverifiedShow Answer

Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense accounts, and the withdrawals account to owner's capital.

Correct AnswerverifiedShow Answer

Two common subgroups for liabilities on a classified balance sheet are:

Correct AnswerverifiedShow Answer

Revenues, expenses, and withdrawals accounts, which are closed at the end of each accounting period are:

Correct AnswerverifiedShow Answer

Current liabilities include accounts receivable, unearned revenues, and salaries payable.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Reversing entries are linked to ______________ and _ that were created by adjusting entries at the end of the prior accounting period. __________________________________

Correct Answer
verified
Chapter 04 Completin...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
Required:
Prepare a classifie...
View Answer

Correct Answer
verified

Correct Answer
verified
A work sheet is a useful tool for organi...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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