Recording Adjusting and Closing Entries (B) - Chapter 9

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.

• True

• False

All accounts in a general ledger are listed on a post-closing trial balance.

• True

• False

Adjusting entries are recorded on the next journal page following the page on which the last daily transactions for the month are recorded.

• True

• False

Permanent accounts are also referred to as temporary accounts.

• True

• False

Preparing a work sheet 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.

• True

• False

The ending account balances of permanent accounts for one fiscal period are the beginning account balances for the next fiscal period.

• True

• False

At the end of a fiscal period, the balances of temporary accounts are summarized and transferred to the owner's capital account.

• True

• False

Temporary accounts must start each fiscal period with a zero balance.

• True

• False

Journal entries used to prepare temporary accounts for a new fiscal period are closing entries.

• True

• False

To close a temporary account, an amount equal to its balance is recorded in the account on the side opposite to its balance.

• True

• False