accounting chp 8
The ending account balances of permanent accounts for one fiscal period are (A) the same as the prior period's ending balance (B) equal to the capital account balance (C) all equal to zero (D) the beginning account balances for the next fiscal period
D
Which of the following accounts is a temporary account? (A) Cash (B) Accounts Payable (C) Clyde Sullivan, Capital (D) Rent Expense
D
The journal entry to close income summary when there is a net income
Debit income summary and credit capital
Info needed for closing entries is found in the
Inc Stmt and Bal Sheet columns of the work sheet
When the total expenses are greater than the total revenues
Income summary account has a debit balance`
Which accting concept applies when exps are reported in the same fiscal period they are used
Matching expenses with Revenue
After the closing entries are posted the owner capital accounts balance should be shown
On a balance sheet for the fiscal period
The last step in the accounting cycle
Prepare a post closing trial balance
accounting cycle
The series of accounting activities included in recording financial information for a fiscal period
post-closing trial balance
a trial balance prepared after the closing entries are posted
permanent accounts
accounts used to accumulate information from one fiscal period to the next
temporary accounts
accounts used to accumulate information until it is transferred to the owner's capital account
The journal entry to close the expense accounts is
dr Inc Sum for the total exp, cr each exp account
After the closing entries are posted, there is no need to verify debits and credits equal.
false
At the end of a fiscal period the balance on a permanent account is summarized and transferred to a new account
false
It is considered good accounting practice to leave expenses in an account for the next month.
false
Permanent accounts are used to accumulate information until it is transferred to the owner's capital account
false
Temporary accounts include assets, expenses, and the owner's drawing account
false
The balances of the liability account must be reduced to 0 to prepare the accounts for the next period
false
The drawing account is a permanent account
false
The four types of closing entries can be remember by: REED
false
The income summary account has a normal debit balance
false
closing entries
journal entries used to prepare temporary accounts for a new fiscal period
The last step in the accting cycle is to
none of these
accounts used to accumulate information from one fiscal period to the next is
permanent accounts
Income summary is a
temporary account
A post closing trial balance verifies the quality of debits and credits in a general ledger after the closing entries are posted
true
Adjusting entries are recorded on the journal page after the last daily trans for the month
true
Journal entries used to prepare temporary accounts for a new fiscal period are closing entries
true
Temporary accounts are also called nominal accounts
true
Temporary accounts must start each fiscal period with a 0 balance
true
The capital accounts new balance after all closing entries are posted is verified for the capital shown at the end of the fiscal period
true
The drawing account is neither a revenue nor an expense account.
true
The ending account balances of permanent accounts for one fiscal period are the beginning accounts for the next fiscal period
true
The series of accounting activities included in recording financial information for a fiscal period in a accounting cycle
true
To close a temporary account an amount equal to it balance is reported to the sides opposite of its balance
true
When there is a net loss, the income summary account will have a debit balance.
true
After closing entries are posted the balance in the owner's drawing account should be
0
Temporary accounts begin each new fiscal period with a
0 balance
After the closing entries are posted, the Sales account balance should be (A) equal to the Sales account balance on the unadjusted trial balance (B) equal to the Sales account balance on the adjusted trial balance (C) zero (D) the same as the beginning balance for that same fiscal period
A
The accounts listed on a post-closing trial balance are (A) general ledger accounts with balances after the closing entries are posted (B) all general ledger accounts (C) those that have no balances after adjusting and closing entries (D) those that appear in the work sheet's Trial Balance columns
A
The accounts that appear on the post closing trial balance are
Assets, liabilities, and owner's capital
Information needed for recording the closing entries is obtained from the (A) general ledger accounts' Debit Balance columns (B) work sheet's Income Statement and Balance Sheet columns (C) balance sheet (D) income statement
B
When revenue is greater than total expenses, resulting in a net income, the Income Summary account has a (A) debit balance (B) credit balance (C) normal debit balance (D) normal credit balance
B
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? (A) Business Entity (B) Accounting Period Cycle (C) Going Concern (D) Full Disclosure
B
After the closing entries are posted, the Sales account balance should be (A) equal to the Sales account balance on the unadjusted trial balance (B) equal to the Sales account balance on the adjusted trial balance (C) zero (D) the same as the beginning balance for that same fiscal period
C
Income Summary is (A) an asset account (B) a liability account (C) a temporary account (D) a permanent account
C
Which accounting concept applies when expenses are reported in the same fiscal period that they are used to produce revenue? (A) Business Entity (B) Going Concern (C) Matching Expenses with Revenue (D) Full Disclosure
C
