1. after the adjusting entries are journalized and posted to the

1.  After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each accounts should agree with the balance shown on the 

 

a.The general journal

b.Post closing trial balance adjusted trial balance

c. adjusted trial balance

d.Adjustment column of the worksheet

 

2.  The net income ( or loss ) for the period

 

a. cannot be found on the worksheet

b.is found by computing the difference between the trial balance totals and the adjusted trial balance totals

c.is found by computing the difference between the income statement credit column and the balance sheet credit column on the worksheet.

d.is found by computing the difference between the income statement columns of the worksheet.

 

3.  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 

 

a.debit to the owner’s dividends account

b.debit to the retained earnings account

c.credit to the retained earning account

d.credit to the owner’s dividends account.

 

4.  Revenues $70,000

Expenses

Wages Expense $ 45,000 

Rent Expense $ 12,000

Advertising Expense $ 6,000

Supplies Expense $ 6,000

Utilities Expense $ 2,500

Insurance Expense $ 2,000

———–

Total Expenses $ 73,500

———–

Net income ( loss ) $ 3,500

———-

After the revenue and expense accounts have been closed, the balance in income summary will be

 

a.  a debit balance of $ 3,500       

b.  a credit balance of $ 3,500

c.  $ 0

d.  A credit balance of 70,000

 

5.  A post-closing trial balance will show

 

a.  zero balances for the accounts

b.  zero balances for balance sheet accounts

c.  only balance sheet accounts

d.  only income statement accounts

 

6.  Which of the following steps in the accounting cycle would not generally be performed daily

 

a. Journalize transactions

b. Post to ledger accounts

c. Prepare adjusting entries

d. Analyze business transactions

 

7.  The two optional steps in the accounting cycle are preparing

 

a. a worksheet and post-closing trial balance

b. a post-closing trial balance and reversing entries

c. reversing entries and a worksheet

d. an adjusted trial balance and a post closing trial balance

 

8.  Speedy Bike Company received a $ 940 check from a customer for the balance due. The transaction was erroneously recorded as a debit to Cash $ 490 and a credit to service revenue $ 490. The correcting entry is

 

a.  debit cash, $ 940; credit account receivable, $ 940

b.  debit cash, $ 450 and service revenue, $ 490; credit account receivable, $ 940

c.  debit accounts receivable, $ 940; credit cash, $ 450 and service revenue, $ 490

d.  debit cash, $ 450 and accounts receivable, $ 490; credit service revenue, $ 940

 

9. The first item listed under current liabilities is usually 

 

a.  taxes payable

b.  salaries payable

c.  accounts payable 

d.  notes payable

 

10. The operating cycle of a company is the average time that is required to go from cash to

 

a. accounts receivable in producing revenues

b. inventory in producing revenues

c. sales in producing revenues

d. cash in producing revenues

 

11. On a classified balance sheet, current assets are customarily listed

 

a. in the order of liquidity

b. in alphabetical order

c. with the largest dollar amounts first

d. in the order of acquisition

 

12. The most important information needed to determine if companies can pay their current obligations is the 

 

a. relationship between short-term and long-term liabilities

b. relationship between current assets and current liabilities

c. projected net income for next year

d. net income for this year

 

13. Balance sheet accounts are considered to be

 

a. temporary owner’s equity accounts

b. permanent accounts

c. nominal accounts

d. capital accounts

 

14. Correcting entries are made

 

a. after closing entries

b. whenever an error is discovered

c. at the end of an accounting period

d. at the beginning of an accounting period

 

15. Goodwill would be reported in the ———————section of a classified balance sheet

 

a. current asset

b. intangible assets

c. long term investments

d. long term liabilities

 

 

 

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