accounting chp 8

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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


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