A worksheet can be thought of as a(n)

b. optional device used by accountants.

a. permanent accounting record.

When constructing a worksheet, accounts are often needed that are not listed in the trial balance already entered on the worksheet from the ledger. Where should these additional accounts be shown on the worksheet?

c. They should be inserted on the lines immediately below the trial balance totals.

a. They should be inserted in alphabetical order into the trial balance accounts already given.

b. They should be inserted in chart of account order into the trial balance already given.

d. They should not be inserted on the trial balance until the next accounting period.

When using a worksheet, adjusting entries are journalized

c. after the worksheet is completed and after financial statements have been prepared.

a. after the worksheet is completed and before financial statements are prepared.

b. before the adjustments are entered on to the worksheet.

d. before the adjusted trial balance is extended to the proper financial statement columns.

Assuming that there is a net loss for the period, debits equal credits in all but which section of the worksheet?

d. Adjusted trial balance columns

Adjusting entries are prepared from

b. the adjustments columns of the worksheet.

The net income (or loss) for the period

c. is found by computing the difference between the income statement columns of the worksheet.

a. is found by computing the difference between the income statement credit column and the balance sheet credit column on the worksheet.

b. cannot be found on the worksheet.

d. is found by computing the difference between the trial balance totals and the adjusted trial balance totals.

The worksheet does not show

a. net income or loss for the period.

b. revenue and expense account balances.

c. the ending balance in the owner's capital account.

d. the trial balance before adjustments.

If the total debits exceed total credits in the balance sheet columns of the worksheet, owner's equity

a. will increase because net income has occurred.

b. will decrease because a net loss has occurred.

c. is in error because a mistake has occurred.

Closing entries are necessary for

c. both permanent and temporary accounts.

d. permanent or real accounts only.

Each of the following accounts is closed to Income Summary except

d. All of these are closed to Income Summary.

Closing entries are made

c. in order to transfer net income (or loss) and owner's drawing to the owner's capital account.

a. in order to terminate the business as an operating entity.

b. so that all assets, liabilities, and owner's capital accounts will have zero balances when the next accounting period starts.

d. so that financial statements can be prepared.

d. journalized in the general journal.

a. an optional step in the accounting cycle.

b. posted to the ledger accounts from the worksheet.

c. made to close permanent or real accounts.

The income summary account

b. appears on the balance sheet.

c. appears on the income statement.

If Income Summary has a credit balance after revenues and expenses have been closed into it, the closing entry for Income Summary will include a

c. credit to the owner's capital account.

a. debit to the owner's capital account.

b. debit to the owner's drawing account.

d. credit to the owner's drawing account.

Closing entries are journalized and posted

b. after the financial statements are prepared.

a. before the financial statements are prepared.

d. at the end of each interim accounting period.

c. cause the revenue and expense accounts to have zero balances.

a. are prepared before the financial statements.

b. reduce the number of permanent accounts.

d. summarize the activity in every account.

Which of the following is a true statement about closing the books of a proprietorship?

c. Revenues and expenses are closed to the Income Summary account.

a. Expenses are closed to the Expense Summary account.

b. Only revenues are closed to the Income Summary account.

d. Revenues, expenses, and the owner's drawing account are closed to the Income Summary account.

Closing entries may be prepared from all but which one of the following sources?

a. Adjusted balances in the ledger

b. Income statement and balance sheet columns of the worksheet

d. Income and owner's equity statements

In order to close the owner's drawing account, the

d. owner's capital account should be debited.

a. income summary account should be debited.

b. income summary account should be credited.

c. owner's capital account should be credited.

In preparing closing entries

b. each expense account will be credited.

a. each revenue account will be credited.

c. the owner's capital account will be debited if there is net income for the period.

d. the owner's drawing account will be debited.

The most efficient way to accomplish closing entries is to

d. credit the income summary account for total revenues and debit the income summary account for total expenses.

a. credit the income summary account for each revenue account balance.

b. debit the income summary account for each expense account balance.

c. credit the owner's drawing balance directly to the income summary account.

The closing entry process consists of closing

a. all asset and liability accounts.

b. out the owner's capital account.

An error has occurred in the closing entry process if

d. the balance sheet accounts have zero balances.

a. revenue and expense accounts have zero balances.

b. the owner's capital account is credited for the amount of net income.

c. the owner's drawing account is closed to the owner's capital account.

The Income Summary account is an important account that is used

c. annually in preparing closing entries.

b. in preparing adjusting entries.

d. annually in preparing correcting entries.

The balance in the income summary account before it is closed will be equal to

a. the net income or loss on the income statement.

b. the beginning balance in the owner's capital account.

c. the ending balance in the owner's capital account.

After closing entries are posted, the balance in the owner's capital account in the ledger will be equal to

b. the amount of the owner's capital reported on the balance sheet.

a. the beginning owner's capital reported on the owner's equity statement.

d. the net income for the period.

A post-closing trial balance is prepared

a. after closing entries have been journalized and posted.

b. before closing entries have been journalized and posted.

c. after closing entries have been journalized but before the entries are posted.

d. before closing entries have been journalized but after the entries are posted.

All of the following statements about the post-closing trial balance are correct except it

d. proves that all transactions have been recorded.

a. shows that the accounting equation is in balance.

b. provides evidence that the journalizing and posting of closing entries have been properly completed.

c. contains only permanent accounts.

A post-closing trial balance will show

a. only permanent account balances.

b. only temporary account balances.

c. zero balances for all accounts.

d. the amount of net income (or loss) for the period.

A post-closing trial balance should be prepared

b. after closing entries are posted to the ledger accounts.

a. before closing entries are posted to the ledger accounts.

c. before adjusting entries are posted to the ledger accounts.

d. only if an error in the accounts is detected.

A post-closing trial balance will show

c. only balance sheet accounts.

a. zero balances for all accounts.

b. zero balances for balance sheet accounts.

d. only income statement accounts.

The purpose of the post-closing trial balance is to

b. prove the equality of the balance sheet account balances that are carried forward into the next accounting period.

a. prove that no mistakes were made.

c. prove the equality of the income statement account balances that are carried forward into the next accounting period.

d. list all the balance sheet accounts in alphabetical order for easy reference.

The balances that appear on the post-closing trial balance will match the

b. balance sheet account balances after closing entries.

a. income statement account balances after adjustments.

c. income statement account balances after closing entries.

d. balance sheet account balances after adjustments.

A double rule applied to accounts in the ledger during the closing process implies that

a. the account is an income statement account.

b. the account is a balance sheet account.

c. the account balance is not zero.

d. a mistake has been made, since double ruling is prescribed.

The heading for a post-closing trial balance has a date line that is similar to the one found on

c. an owner's equity statement.

Which one of the following is usually prepared only at the end of a company's annual accounting period?

c. Journalizing and posting closing entries

a. Preparing financial statements

b. Journalizing and posting adjusting entries

d. Preparing an adjusted trial balance

The step in the accounting cycle that is performed on a periodic basis (i.e., monthly, quarterly) is

b. journalizing and posting adjusting entries.

c. preparing a post-closing trial balance.

Which one of the following is an optional step in the accounting cycle of a business enterprise?

a. Analyze business transactions

The final step in the accounting cycle is to prepare

c. a post-closing trial balance.

Which of the following steps in the accounting cycle would not generally be performed daily?

d. Analyze business transactions

poa 04.01

Authored by Annette Malfoy

Mathematics

University

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50 questions

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MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Preparing a worksheet involves

a. two steps.

b. three steps.

c. four steps.

d. five steps.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The adjustments entered in the adjustments columns of a worksheet are

a. not journalized.

b. posted to the ledger but not journalized.

c. not journalized until after the financial statements are prepared.

d. journalized before the worksheet is completed.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The information for preparing a trial balance on a worksheet is obtained from

a. financial statements.

b. general ledger accounts.

c. general journal entries.

d. business documents.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each account should agree with the balance shown on the

a. adjusted trial balance.

b. post-closing trial balance.

c. the general journal.

d. adjustments columns of the worksheet.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If the total debit column exceeds the total credit column of the income statement columns on a worksheet, then the company has

a. earned net income for the period.

b. an error because debits do not equal credits.

c. suffered a net loss for the period.

d. to make an adjusting entry.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A worksheet is a multiple column form that facilitates the

a. identification of events.

b. measurement process.

c. preparation of financial statements.

d. analysis process.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following companies would be least likely to use a worksheet to facilitate the adjustment process?

a. Large company with numerous accounts

b. Small company with numerous accounts

c. All companies, since worksheets are required under generally accepted accounting principles

d. Small company with few accounts

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poa 04.01

Preparing a worksheet involves

The adjustments entered in the adjustments columns of a worksheet are

The information for preparing a trial balance on a worksheet is obtained from

After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each account should agree with the balance shown on the

If the total debit column exceeds the total credit column of the income statement columns on a worksheet, then the company has

A worksheet is a multiple column form that facilitates the

Which of the following companies would be least likely to use a worksheet to facilitate the adjustment process?

A worksheet can be thought of as a(n)

The account, Supplies, will appear in the following debit columns of the worksheet.

When constructing a worksheet, accounts are often needed that are not listed in the trial balance already entered on the worksheet from the ledger. Where should these additional accounts be shown on the worksheet?

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