accoutning chapter 8
a temporary account
Income summary is ____.
work sheets adjustment column
Information needed for journalizing the adjusting entries is obtained from the ____.
work sheets Income Statement and Balance Sheet columns
Information needed for recording the closing entries is obtained from the ____.
work sheets income statement debit column
Information needed to journalize a closing entry for expenses is obtained from the ____.
work sheets income statement credit column
Information needed to journalize a closing entry for revenue is obtained from the ____.
a work sheets net income or net loss line
Information needed to journalize a closing entry for the income summary account is obtained from ____.
work sheets balance sheet debit column
Information needed to journalize a closing entry for the owner's drawing account is obtained from the ____.
those that have balances after the closing entries are posted
The accounts listed on a post-closing trial balance are ____.
debit income summary, credit owners capital
The journal entry to close Income Summary when there is a net income is ____.
debit owners capital, credit income summary
The journal entry to close Income Summary when there is a net loss is ____.
debit owners capital account, credit owners drawing account
The journal entry to close the drawing account is ____.
none of the above
The last step in the accounting cycle is ____.
accounting period cycle
Which accounting concept applies when a work sheet is prepared at the end of each fiscal cycle to summarize the general ledger information needed to prepare financial statements?
matching expenses with revenue
Which accounting concept applies when expenses are reported in the same fiscal period that they are used to produce revenue?
adequate disclosure
Which accounting concept applies when financial statements are prepared from information on the work sheet?
t
a post closing trial balance verifies the equality of debits and credits in a general ledger after the closing entries are posted
f
a source document is prepared for adjusting entries
f
a source document is prepared for closing entries
permanent
accounts used to accumulate information from one fiscal period to the next are _____ accounts
temporary
accounts used to accumulate information until it is tranferred to owners capital accounts are _______ accounts
t
adjusting entries are recorded on the next journal page following the page on which the last daily transactions for the month are recorded
on a work sheet
adjustments are analyzed and planned______
t
adjustments are first analyzed and planned on a work sheet before the adjusting entries are journalized
the value of insurance premiums used during the fiscal period
after the adjusting entry for prepaid insurance has been posted, insurance expense has an up to date balance, which is the ______
value of supplies used during the fiscal period
after the adjusting entry for supplies has been posted, supplies expense has an up to date balance, which is the ______
permament
after the closing entries are posted, the only accounts with balances are ____ accounts.
f
all accounts in a general ledger are listed on a post closing trial balance
t
at the end of a fiscal period, the balances of temporary accounts are summarized and transferred to the owners capital account
income statement and balance sheet columns of the work sheet
information needed for closing entries is found in the _______
t
information needed to record closing entries is found in the income statement and balance sheet columns of the work sheet
t
journal entries used to prepare temporary accounts for a new fiscal period are closing entries
f
permanent accounts are also referred to as temporary accounts
t
preparing a worksheet at the end of each fiscal period to summarize the general ledger information needed to prepare financial statements is an application of the accounting concept Accounting Period cycle
t
temporary accounts are not listed on a post closing trial balance
zero balance
temporary accounts begin each new fiscal period with a _________
t
temporary accounts must start each fiscal period with a zero balance
t
the balances of the expense accounts must be reduced to zero to prepare the accounts for the next fiscal period
t
the capital account's new balance after all closing entries are posted is verified by checking it with the amount of capital shown on the balance sheet at the end of the fiscal period
f
the drawing account is a permanent account
t
the ending account balances of permanent accounts for one fiscal period are the beginning account balances for the next fiscal period
t
the income summary account balance must be reduced to zero to prepare the account for the next fiscal period
f
the income summary account has a normal debit balance
debit insurance expense, credit prepaid insurance
the journal entry to adjust prepaid insurance is _____
debit supplies expense, credit supplies
the journal entry to adjust supplies is_____
debit sales, credit income summary
the journal entry to close sales is _____
debit income summary for the total expenses, credit each expense account
the journal entry to close the expense accounts is _____
t
to close a temporary account, an amount equal to its balance is recorded in the account on the side opposite to its balance
the income summary account has a credit balance
when the revenue is greater than the total expenses, ________
the income summary account has a debit balance
when the total expenses are grater than the total revenue, _______
on the balance sheet for the fiscal period
After the closing entries are posted, the owner's capital account balance should be the same as shown ____.