Accounting

trial balance

list of accounts and their balances at a point in time

Select the statement below that describes a post-closing trial balance.

listing of all permanent accounts and their balances after closing.

Kara Eastmond, the owner of Tiptop Cleaning Service, had annual revenues of $188,000, expenses of $104,600 and withdrew $27,300 from the business during the current year. The owner's capital account before closing had a balance of $155,000. The net income reported on the Income Statement for Tiptop Cleaning Service is:

$83,400 Net Income

The unadjusted Trial Balance of a company's work sheet shows the Store Supplies account with a $610 balance. The adjustments columns show a credit of $340 for supplies used during the period. The amount shown as Store Supplies in the Balance Sheet columns of the work sheet is

270 debit

Prepaid Insurance has a $1,670 balance on the Unadjusted Trial Balance section of the worksheet. The Adjustments Column show that $720 of insurance has been used during the period. The amount of Prepaid Insurance reflected in the Balance Sheet would b

950 debit

A company has $438,000 in service revenue at year end. The closing entry would include

A debit to Service Revenue of $438,000

The trial balance created after all adjustments are made, but before the closing process is complete is called the

ADJUSTED TRAIL BALANCE

Which of the following is classified as a current asset

Accounts receivable

Identify which of the following steps in the accounting cycle is optional Reversing journal entries

An unclassified balance sheet is one whose items are broadly grouped into assets, liabilities, and equity.

When does the closing process take place?

At the end of an accounting period

Summarize the steps in the closing process by selecting the correct choice below.

Close income statement credit balance accounts; close income statement debit balance accounts; close income summary; close withdrawals.

Closing the temporary accounts at the end of each accounting period does NOT do which of the following?

Brings the asset and liability accounts to zero balances.

Which of the following accounts would be sorted from the Adjusted Trial Balance of a work sheet to the Balance Sheet & Statement of Owner's Equity columns on a work sheet?

Cash; Accounts payable; Owner, Withdrawals

After an adjusted trial balance is prepared, what is the next step in completing the work sheet used in preparing financial statements

Sort adjusted trial balance amounts to the financial statement columns.

Describe your understanding of the closing process by identifying the correct steps below

Close the Income Summary account. · Close the Withdrawals account. · Close all revenue accounts. · Close all expense accounts

Assets that are cash and other resources that are expected to be sold, collected, or used with one year are classified as

Current Assets

Liabilities due to be paid or settled within one year are called

Current Liabilities

A classified balance sheet has several categories for assets and liabilities including

Current assets. · Noncurrent (long-term) liabilities. · Plant assets. · Long-term investments.

A company has Consulting Revenue of $250,000 and Rent Revenue of $24,000. The closing entry for this business would be

Debit Consulting Revenue, $250,000, Debit Rent Revenue $24,000 and Credit Income Summary $274,000.

Tara Westmont, the owner of Tiptoe Shoes, had annual revenues of $193,000, expenses of $107,700 and withdrew $21,200 from the business during the current year. The owner's capital account before closing had a balance of $305,000. the entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is

Debit Income Summary $85,300, credit T. Westmont, Capital $85,300

Michele Sosnow, the proprietor of Ski Services, withdrew $13,180 from the business during the current year. The entry to close the withdrawals account at the end of the year is

Debit M. Sosnow, Capital $13,180; credit M. Sosnow, Withdrawals $13,180.

Which of the following is correct regarding a work sheet?

Each set of column totals must balance on the Trial Balance columns, Adjustments columns and the Adjusted Trial Balance columns.

Closing entries are necessary at the end of each period to

Ensure that temporary accounts begin each period with zero balances

Select the statements below which correctly describe how to use the work sheet in the adjustment process

Information from the Adjustments columns are used for the adjusting journal entries. Journalizing and posting adjusting entries is required after adjustments are entered in a work sheet.

Which of the following accounts would be closed at the end of the accounting period?

Insurance expense

What is a work sheet

It can help with adjusting and closing accounts and with preparing financial statements.

Review the following statements and select the ones that are correct regarding sorting accounts from the Adjusted Trial Balance columns of a work sheet to the Income Statement and Balance Sheet columns in order to prepare for our last step of completing the worksheet. (Check all that apply.)

Liabilities go to the Balance Sheet & Statement of Owner's Equity Credit column. Owner, Withdrawals go to the Balance Sheet & Statement of Owner's Equity Debit column. Expense accounts go to the Income Statement Debit column.

Which one of the following is NOT a current liability

Long-term Notes Payable

A classified balance sheet has several categories for assets and liabilities including: (Check all that apply.)

Plant assets. · Long-term investments. · Current assets. · Noncurrent (long-term) liabilities

A list of permanent accounts and their balances after all closing entries are recorded is called

Post Closing Trial Balance

Which one of the following accounts would be closed at the end of the period

Rent Expense

Which of the following accounts is likely to appear on a closing journal entry

Rent Revenue

The Credit column of the Income Statement columns represent

Revenue reported on the Income Statement

Western Airlines provided flights this moth for customers who paid cash last month for a ticket. Which of the following best describes the accounting for this situation from Western's perspective in the current period

Revenue was earned and a liability was reduced

Which of the following accounts would be included in one of the closing journal entries for a business

Salary Expense

When a concert promotion company collects cash for ticket sales three months in advance of a band's tour date, which of the following accounts is affected

Unearned Concert Revenue

Identify the accounts below that would be classified as current liabilities on a classified balance sheet

Unearned rent · Taxes payable · Accounts payable

Identify the accounts below that would be classified as current liabilities on a classified balance sheet.

Unearned rent, Taxes payable, Accounts payable

A temporary account will not

appear on a post-closing trial balance.

Which of the following is a real or permanent account that is NEVER closed during the closing process.

cash

Current assets are

cash and other resources that are expected to be sold, collected or used within one year

An Adjusted Trial Balance: Shows the

ending balances in a "debit" and "credit" format after adjusting journal entries are posted

Explain the required steps to complete a work sheet by placing the following steps in the correct order.

enter unadjusted trail balance, enter adjustments, prepare adjusted trial balance, sort adjusted trial balance amounts to financial statements, total financial statement columns, compute income or loss and balance columns

The Debit column of the Income Statement columns represent

expenses reported on the Income Statement.

Which of the following is TRUE about a worksheet.

helps prepare financial statements, reduce risk of errors when working with many accounts and adjustments, Links accounts and adjustments to financial statement

work sheet

internal accounting aid which helps in preparing financial statements

Depreciation Expense Is an expense that

is closed into the Income Summary Account at the end of the accounting period.

An unclassified balance sheet is one whose

items are broadly grouped into assets, liabilities, and equity.

Current items are those expected to come due within

n one year or the company's operating cycle, whichever is longer

The Withdrawals account balance will be used in

preparing the statement of owner's equity.

income statement

reports a business's revenues and expenses for period of time

balance sheet

reports business assets, liabilities, equity on specific date

statement of cash flows

reports inflows/outflows of cash during period of time

Closing means to

reset an account balance to zero.

net income equals

revenues minus expenses

Long-term liabilities are debts of a business that

that are not due to be settled within one year.

The Income Summary account is used during the closing process to facilitate

the closing of revenue and expense accounts

What are current liabilities?

usually settled by paying out current assets such as cash, e liabilities due to be paid within one year.

Select the statements below that describe the purpose of a post-closing trial balance.

verify that all temporary accounts have zero balances, verify that total debits equal total credit for permanent accounts