Week 4 exercise

During the accounting period, Cash was debited for $4,000, $3,000, and $1,000. Cash was also credited for $3,000, $500, and $100. The beginning balance of Cash was a $10,000 debit. What is the ending balance of Cash on the post-closing trial balance? a. $21,600 debit b. $14,400 debit c. $21,600 credit d. $14,400 credit

b. $14,400 debit

The following amounts were taken from a company's balance sheet: Total assets $100,000 Total liabilities 20,000 Total stockholders' equity. 80,000 Current assets 10,000 Current liabilities 5,000 The company's current ratio is a. 5.0. b. 2.0. c. 0.5. d. 20.

b. 2.0.

The journal entry required to close the dividends account includes a. a debit to Common Stock and a credit to Dividends. b. a debit to Retained Earnings and a credit to Dividends. c. a debit to Retained Earnings and a credit to Cash. d. a credit to Common Stock and a debit to Retained Earnings.

b. a debit to Retained Earnings and a credit to Dividends.

On the work sheet, the Dividends balance in the Adjusted Trial Balance Debit column will flow into the a. balance sheet. b. statement of stockholders' equity. c. income statement. d. balance sheet and statement of stockholders' equity.

b. statement of stockholders' equity.

Which of the following is an example of a fixed asset? a. Supplies b. Accounts receivable c. Land d. Unearned fees

c. Land

Which task will an accountant most likely perform to ensure revenues and expenses are properly matched? a. Prepare financial statements. b. Count inventory. c. Record adjusting entries. d. Reconcile petty cash.

c. Record adjusting entries.

When are the balances of temporary accounts set to zero? a. at the end of each week b. at the end of each pay period c. at the end of the year d. at the end of the employee's employment with the company

c. at the end of the year

All of the following accounts will appear on the post-closing trial balance EXCEPT a. accounts payable. b. accounts receivable. c. depreciation expense. d. cash.

c. depreciation expense.

A business's yearly accounting period is called the a. financial year-end. b. accountant's annual budget. c. fiscal year. d. yearly balance sheet.

c. fiscal year.

Year-to-date summaries on a paycheck stub are similar to the way a. expenses and revenues are transferred to an income summary. b. adjusting entries are recorded in the journal. c. income statement accounts accumulate revenues and expenses over a period. d. none of these.

c. income statement accounts accumulate revenues and expenses over a period.

On the end-of-period spreadsheet, which of the following accounts would not be extended to the Balance Sheet columns? a. Accounts Receivable b. Common Stock c. Accumulated Depreciation d. Fees Earned

d. Fees Earned

Why do companies base their fiscal year on a natural business cycle?a. It provides greater tax advantages. b. It's the time of highest sales volume, and thus provides greater advantage to investors. c. Accountants want to close their books at the end of the year. d. It's at the low point in the operating cycle and provides time to analyze operations and prepare financial statements.

d. It's at the low point in the operating cycle and provides time to analyze operations and prepare financial statements.

All of the following accounts/account types are closed at the end of the accounting period EXCEPT a. Revenues. b. Expenses. c. Dividends. d. Retained Earnings.

d. Retained Earnings.

Which of the following financial statements is not normally prepared directly from the end-of-period spreadsheet? a. Income statement b. Balance sheet c. Retained earnings statement d. Statement of Cash Flows

d. Statement of Cash Flows

The first step of the accounting cycle is to a. post transactions to the ledger. b. prepare an unadjusted trial balance. c. assemble and analyze adjustment data. d. analyze transactions and record them in the journal.

d. analyze transactions and record them in the journal.

Supplies had a beginning balance of $4,000. A physical count at the end of the accounting period revealed $2,500 supplies on hand. What adjustment amount will appear for Supplies in the Adjustments section of the end-of-period spreadsheet? a. $1,500 credit b. $6,500 credit c. $2,500 debit d. $1,500 debit

a. $1,500 credit

he following amounts were taken from a company's balance sheet: Total assets $ 100,000 Total liabilities 20,000 Total stockholders' equity 80,000 Current assets 10,000 Current liabilities. 5,000 The company's working capital is a. $5,000. b. $10,000. c. $20,000. d. $80,000.

a. $5,000.

Which of the following accounts is least likely to be used in the cash basis of accounting? a. Accounts Payable b. Supplies Expense c. Office Equipment d. Common Stock

a. Accounts Payable

Which of the following accounts will NOT appear on the post-closing trial balance? a. Fees Earned b. Cash c. Accounts Receivable d. Accounts Payable

a. Fees Earned

Payment of wages would be considered which type of activity? a. Operating b. Investing c. Financing d. Adjusting

a. Operating

Which financial statements include the ending cash balance? a. Statement of cash flows and balance sheet b. Statement of cash flows and statement of stockholders' equity c. Balance sheet and statement of stockholders' equity d. Income statement and statement of cash flows

a. Statement of cash flows and balance sheet

Why should investors and others be careful in interpreting partial-year reports for companies that use the natural business year for their fiscal year? a. The operations of the companies vary significantly throughout the fiscal year. b. Partial-year reports show only the highest points of a business. c. Partial-year reports show only the lowest points of a business. d. These reports are not used for the fiscal year reports.

a. The operations of the companies vary significantly throughout the fiscal year.

On the work sheet, the cash balance in the Adjusted Trial Balance Debit column will flow into the a. balance sheet. b. statement of stockholders' equity. c. income statement. d. balance sheet and income statement.

a. balance sheet.

Which of these does NOT represent a decrease in net cash received on an employee's paycheck? a. gross wages b. Medicare taxes c. social security taxes d. federal withholding taxes

a. gross wages

The last step of the accounting cycle is to a. prepare a post-closing trial balance. b. prepare an adjusted trial balance. c. prepare financial statements. d. journalize the post-closing entries.

a. prepare a post-closing trial balance.

Revenue accounts appear on a. the income statement. b. the balance sheet. c. the statement of stockholder's equity. d. the statement of cash flows.

a. the income statement.