Chapter 6 Test Review

Only accounts with a balance are listed in the Trial Balance columns of a work sheet.

• True

• False

Adjusting entries must be posted to the general ledger accounts.

• True

• False

Many businesses choose a one-year fiscal period that ends during a period of high business activity.

• True

• False

Two financial statements are prepared from the information on the work sheet.

• True

• False

If the Trial Balance columns are not equal and the difference can be evenly divided by 9, then the error most likely is a transposed number.

• True

• False

When the Income Statement Debit column total is greater than the Income Statement Credit column total on a work sheet, the business has a net income.

• True

• False

Net income on a work sheet is calculated by subtracting the Income Statement Debit column total from the Income Statement Credit column total.

• True

• False

If an amount is written in an incorrect column of a work sheet, the error should be erased and the amount should be written in the correct column.

• True

• False

The accounting concept Consistent Reporting is being applied when a word processing service business reports revenue per page one year and revenue per hour the next year.

• True

• False

The amount of the supplies used during a fiscal period is an expense.

• True

• False