Chapter 4 Quiz - Accounting

balance sheet in the noncurrent assets section

where do notes receivable due in 390 days appear on?

balance sheet as a current liability

where do unearned fees appear on?

equal each other

After net income is entered on the end-of-period spreadsheet, the Balance Sheet Debit and Credit columns must

real accounts

Another name for balance sheet accounts

fiscal year that ends when business activities are at their lowest point

At what point does it end?

the last day of the accounting period, although they are actually journalized after the end of the accounting period

Closing entries are dated in the journal as of

$700

Diane's Designs purchased a one-year liability insurance policy on March 1 of this year for $8,400 and recorded it as a prepaid expense. Which of the following amounts would be recorded for insurance expense during the adjusting process at the end of Diane's first month of operations on March 31?

increase an expense account

On September 1, the company pays rent for twelve months in advance and debits an asset account. At year end, the adjusting entry on the work sheet would

adding investments plus net income less withdrawals

The statement of owner's equity begins with the beginning balance followed by

False

True or False: Accrued revenues are ordinarily listed on the balance sheet as current liabilities.

True

True or False: Journalizing and posting the adjustments and closing entries updates the ledger for the new accounting period.

False

True or False: The accumulated depreciation account is closed to the income summary account.

True

True or False: The chart of accounts, the journal, and the ledger are essential parts of the accounting system.

True

True or False: The income statement is prepared from the adjusted trial balance or the income statement columns on the work sheet.

True

True or False: The work sheet is not considered a part of the formal accounting records.

after the income statement and before the balance sheet

When should the statement of owner's equity should be prepared?

Unearned Rent

Which of the following accounts ordinarily appears in the post-closing trial balance? (supplies expense; zane white, drawing; unearned rent; fees earned)

income summary

Which of the following accounts will be closed to the capital account at the end of the fiscal year? (rent expense, depreciation expense, fees earned, income summary)

All real accounts are closed at the end of the period.

Which of the following is not true about closing entries? (All real accounts are closed at the end of the period; After the second closing entry, the income summary account is equal to the net income or loss for the period; There are four closing entries that update the owner's equity account; By closing nominal accounts at the end of the period to zero, it is possible to isolate next period's information correctly)