Chapter 8 Review
The ________ of the work sheet includes all the permanent general ledger accounts.
Balance Sheet Section
The permanent general ledger accounts are extended to the _________ of the work sheet.
Balance Sheet section
The amount of net income for the period of added to the total of the credit column of the Balance Sheet section because it increases the balance in the ________ account.
Capital
A net income is entered in the ________ column of the Balance Sheet section.
Credit
A net loss is entered in the _________ column of the Income Statement section.
Credit
A net income is entered in what column of the Income Statement section?
Debit
Transferring balances from the Trial Balance section is called ________ the balances.
Extending
________ is transferring balances from the Trial Balance section of the work sheet to either the Balance Sheet section or the Income Statement section.
Extending
True or False: A ledger account having a zero balance is not listed on the Trial Balance section of the work sheet.
False
True or False: A work sheet always covers a period of one month.
False
True or False: Account names are listed on the work sheet in alphabetical order.
False
True or False: All liability accounts are listed in the credit column of the Income Statement section.
False
True or False: Amounts from the Trial Balance section are extended first to the Income Statement section.
False
True or False: If the debit column of the Income Statement section of the work sheet is greater than the credit column of the Income Statement section, there is a net income for this period.
False
True or False: The maximum period covered by the accounting cycle is one month
False
True or False: The work sheet has four sections: the heading, the trial balance section, the income statement section and the balance sheet section.
False
True or False: The work sheet is prepared in pen because it is a formal document.
False
True or False: Total expenses for the period are reflected in the totals of the credit column of the Income Statement section and the credit column of the Balance Sheet section.
False
The _______ of the work sheet answers the who, what and when.
Heading
The ________ of the work sheet includes only the temporary general ledger accounts.
Income Statement Section
According to _________, expenses are matched against revenue for the same period.
Matching Principle
The ________ allows a business to match revenue against expenses as means of measuring profit for the period.
Matching Principle
A _______ results when revenue is larger than expenses.
Net Income
The amount left after the expenses for the period have been subtracted from revenue for the period.
Net Income
If the total of the credit column of the Income Statement section is less than the debit column, there is a _________ for the period.
Net Loss
When the Income Statement debit column total is greater than the Income Statement credit column if the Balance Sheet section.
Net Loss
Drawing a line under a column of amounts is known as what?
Ruling
The first two columns of the work sheet are used to enter the _________.
Trial Balance
What part of the work sheet includes all the general ledger accounts?
Trial Balance section
Account titles are listed on the work sheet in the same order as they appear in the general ledger.
True
True or False: A double rule across both amount columns of the trial balance section means that no more entries will be made.
True
True or False: A net income for the period is the amount left after the expenses for the period have been subtracted from the revenue.
True
True or False: A net loss decreases the balance in the owner's equity account.
True
True or False: A net loss for the period is entered in the debit column of the Balance Sheet section.
True
True or False: A single rule under a column of amounts means that the amounts are to be added or subtracted .
True
True or False: All asset accounts are extended to the Balance Sheet section.
True
True or False: Amounts from the Trial Balance section are first extended to the Balance Sheet section.
True
True or False: The Trial Balance section will have entries for all accounts in the general ledger including those with a zero balance.
True
True or False: The work sheet is used to pull together all the information needed to prepare the financial statements and complete the end-of-period activities.
True
A paper used to collect information from the general ledger accounts
Work Sheet
A working paper used to collect information from the ledger accounts.
Work Sheet
What explains the who, what and when of the work sheet?
the heading