Accounting Ch.5

Determine the ending owner's equity of a business having a beginning owner's equity of $10,800, withdrawals of $1,800, and after closing the revenues and expenses Income Summary has a credit balance of $6,920.

$15,920

Given the following list of accounts with normal balances, and after completing the four closing entries; what is the ending balance of M.P., Capital? Accounts Payable $ 3,350 Truck $ 9,000 Design Fees $ 15,415 Cash $ 10,000 Prepaid Insurance $ 1,200 Salaries Payable $ 750 Utilities Expense $ 1,850 Accounts Receivable $ 4,000 M.P., Capital $ 10,452 Advertising Expense $ 1,230 Accumulated Dep.-Truck $ 250 M.P., Withdrawals $ 1,500 Depreciation Expense-Truck $ 1,437

$19,850

The following normal account balances were found on the general ledger before closing entries were prepared: After closing entries are posted, what is the balance in the Capital account? Revenue $1,200 Cash $1,300 Expenses $640 Accounts Receivable $420 Capital $7,000 Withdrawals $1,000

$6,560

Determine the ending owner's equity of a business having a beginning owner's equity of $15,200, withdrawals of $2,000, and after closing the revenues and expenses Income Summary has a debit balance of $5,250.

$7,950

Closing entries are prepared:

All the options provided are correct.

Eav's Event Planning bought a computer on January 1st worth $5,000 with an expected life of 4 years and a residual value of $1,500. What is the adjusting journal entry for December 31 at the end of the first year?

Debit - Depreciation Expense Computer, and Credit - Accumulated Depreciation Computer for $875

Tom's Electrical Service purchased equipment for $6,000. It has an expected life of 10 years and no residual value. The adjusting journal entry for the month is:

Debit - Depreciation Expense Equipment, and Credit - Accumulated Depreciation Equipment for $50

Sandra's Design Studio showed office supplies account showed a balance of $1,000. A count of the supplies left on hand as of June 30 was $700. The adjusting journal entry is:

Debit - Office Supplies, and Credit - Office Supplies Expense for $700

Which of the following accounts would NOT be considered a permanent account?

Depreciation Expense

The income statement debit column of the worksheet showed the following expenses: The journal entry to close the expense account is: Supplies Expense $1,200 Depreciation Expense $ 400 Salaries Expense $ 200

Income Summary $1,800 Supplies Expense $1,200 Depreciation Expense $ 400 Salaries Expense $ 200

Which of the following columns of the worksheet are referred to when preparing closing entries to the Income Summary?

Income statement columns

Closing entries will affect:

Owner's Capital.

After posting the closing entries, which of the following accounts is most likely NOT to have a zero balance?

Prepaid Insurance

Which of the following accounts is a temporary account?

Withdrawals

Which of the following accounts should NOT be closed to Income Summary at the end of the fiscal year?

Withdrawals

Which of the following accounts will be closed directly to Capital at the end of the fiscal year?

Withdrawals

The Income Summary account shows debits of $35,824 and credits of $25,977. This results in:

a net loss of $9,847.

J. Oakely showed a net loss of $5,500. The entry to close the Income Summary account would include a:

debit Capital; credit Income Summary.

To close the Withdrawals account:

debit Capital; credit Withdrawals.

The adjusting entry to record depreciation for the company automobile would be:

debit Depreciation Expense, Automobile; credit Accumulated Depreciation, Automobile.

Given the following list of accounts with normal balances, what is the first closing journal entry to prepare? Accounts Payable $ 3,350 Truck $ 9,000 Design Fees $ 15,415 Cash $ 10,000 Prepaid Insurance $ 1,200 Salaries Payable $ 750 Utilities Expense $ 1,850 Accounts Receivable $ 4,000 M.P., Capital $ 10,452 Advertising Expense $ 1,230 Accumulated Dep.-Truck $ 250 M.P., Withdrawals $ 1,500 Depreciation Expense-Truck $ 1,437

debit Design Fees; credit Income Summary for $15,415.

To close the Fees Earned account:

debit Fees Earned; credit Income Summary.

Given the following list of accounts with normal balances, what is the second closing journal entry to prepare? Accounts Payable $ 3,350 Truck $ 9,000 Design Fees $ 15,415 Cash $ 10,000 Prepaid Insurance $ 1,200 Salaries Payable $ 750 Utilities Expense $ 1,850 Accounts Receivable $ 4,000 M.P., Capital $ 10,452 Advertising Expense $ 1,230 Accumulated Dep.-Truck $ 250 M.P., Withdrawals $ 1,500 Depreciation Expense-Truck $ 1,437

debit Income Summary; credit All Expenses for $4,517

M. Sims showed a net income of $8,000. The entry to close the Income Summary account would include a:

debit Income Summary; credit Capital.

When the balance of the Income Summary account is a credit, the entry to close this account is:

debit Income Summary; credit Capital.

When the balance of the Income Summary account is a debit, the entry to close this account is:

debit Income Summary; credit Capital.

Given the following list of accounts with normal balances, what is the third closing journal entry to prepare? Accounts Payable $ 3,350 Truck $ 9,000 Design Fees $ 15,415 Cash $ 10,000 Prepaid Insurance $ 1,200 Salaries Payable $ 750 Utilities Expense $ 1,850 Accounts Receivable $ 4,000 M.P., Capital $ 10,452 Advertising Expense $ 1,230 Accumulated Dep.-Truck $ 250 M.P., Withdrawals $ 1,500 Depreciation Expense-Truck $ 1,437

debit Income Summary; credit M.P., Capital for $10,898.

Given the following list of accounts with normal balances, what is the fourth closing journal entry to prepare? Accounts Payable $ 3,350 Truck $ 9,000 Design Fees $ 15,415 Cash $ 10,000 Prepaid Insurance $ 1,200 Salaries Payable $ 750 Utilities Expense $ 1,850 Accounts Receivable $ 4,000 M.P., Capital $ 10,452 Advertising Expense $ 1,230 Accumulated Dep.-Truck $ 250 M.P., Withdrawals $ 1,500 Depreciation Expense-Truck $ 1,437

debit M.P., Capital; credit M.P., Withdrawals for $1,500.

The adjusting entry to record the expired rent would be to:

debit Rent Expense; credit Prepaid Rent.

The adjusting entry for accrued salaries is to:

debit Salaries Expense; credit Salaries Payable.

When the balance in the Income Summary account is a credit, the company has:

incurred a net income.

When the balance in the Income Summary account is a debit, the company has:

incurred a net loss.

Closing entries:

must be journalized and posted

An account in which the balance is carried over from one accounting period to the next is called a:

permanent account.

The correct order for closing accounts is:

revenue, expenses, income summary, withdrawals.