Chapter 10 Review for TEST

TRUE OR FALSE:

Revenue and expense accounts must be closed out because their balances apply to only one accounting period.

• TRUE

• FALSE

TRUE OR FALSE:

Closing entries transfer the net income or net loss to the withdrawals account.

• TRUE

• FALSE

TRUE or FALSE:

To close a revenue account, debit it for the amount of its credit balance.

• TRUE

• FALSE

TRUE OR FALSE:

When expense accounts are closed, the Income Summary account is credited.

• TRUE

• FALSE

Closing the revenue account is the ________ closing entry.

• First

• Second

• Third

• Fourth

The last step in the accounting cycle is the preparation of the ___________.

• Income Statement

• Post-closing Trial Balance

• General Ledger

• None of the above

Which of the following accounts is not closed at the end of the accounting period?

• Rent Expense

• Fees

• Ronald Hicks, Capital

• Income Summary

Transferring the expense account balances to the Income Summary account is the _______ closing entry you will complete.

• First

• Second

• Third

• Fourth

Accounts that start each new accounting period with zero balances are ______________.

• Liability Accounts

• Permanent Accounts

• Asset Accounts

• Temporary Accounts

The balance of the revenue account is transferred to the ____.

• Credit Side of the Capital account

• Credit Side of the Income Summary account

• Debit Side of the Income Summary account

• Debit of the Withdrawals account