WorksheetsCH 6 Accounting Review
Total questions: 72
Worksheet time: 36mins
What is the term for reporting income when it is earned and expenses when they are incurred?
Accrual basis of accounting
Cash basis of accounting
Adjusting entries
Fiscal year
Which term refers to changes recorded on a worksheet to update general ledger accounts at the end of a fiscal period?
Fiscal year
Adjusting entries
Net income
Trial balance
What is the difference between total revenue and total expenses when total revenue is greater?
Net loss
Net income
Fiscal year
Balance sheet
What is the term for the length of time for which a business summarizes financial information and reports its financial performance?
Fiscal year
Cash basis of accounting
Accrual basis of accounting
Income statement
What is the term for reporting income when the cash is received and expenses when the cash is paid?
Accrual basis of accounting
Fiscal year
Cash basis of accounting
Adjustments
Which term refers to a columnar accounting form used to summarize the general ledger information needed to prepare financial statements?
Trial balance
Work sheet
Adjusting entries
Fiscal year
What is the term for journal entries recorded to update general ledger accounts at the end of a fiscal period?
Adjustments
Adjusting entries
Fiscal year
Net income
What is the term for cash paid for an expense in one fiscal period that is not used until a later period?
Prepaid expense
Net loss
Fiscal year
Balance sheet
Which term refers to a financial statement showing the revenue and expenses for a fiscal period?
Balance sheet
Income statement
Fiscal year
Net income
What is the term for the difference between total revenue and total expenses when total expenses are greater?
Net income
Net loss
Fiscal year
Adjustments
Which term refers to a financial statement that reports the value of a business’s assets, liabilities, and owner’s equity on a specific date?
Balance sheet
Income statement
Fiscal year
Prepaid expense
What is the term for a proof of the equality of debits and credits in a general ledger?
Work sheet
Trial balance
Adjusting entries
Fiscal year
What is the term for a fiscal period consisting of 12 consecutive months?
Fiscal year
Income statement
Net income
Balance sheet
Which accounts are listed in the Trial Balance columns of a worksheet?
All accounts
Only accounts with a balance
Accounts with zero balance
Accounts with negative balance
Where must adjusting entries be posted?
Income Statement
General Ledger accounts
Trial Balance columns
Balance Sheet
What is the typical fiscal period for many businesses?
One month
One year ending during a period of high business activity
Six months
Two years
How many financial statements are prepared from the information on the worksheet?
One
Two
Three
Four
What does it indicate if the Trial Balance columns are not equal and the difference can be evenly divided by 9?
A missing account
A transposed number
A calculation error
An incorrect ledger entry
What does it mean if the Income Statement Debit column total is greater than the Income Statement Credit column total on a worksheet?
The business has a net income
The business has a net loss
The business is breaking even
The business has no expenses
How is net income on a worksheet calculated?
Adding the Income Statement Debit and Credit column totals
Subtracting the Income Statement Debit column total from the Income Statement Credit column total
Subtracting the Income Statement Credit column total from the Income Statement Debit column total
Dividing the Income Statement Debit column total by the Credit column total
What should be done if an amount is written in an incorrect column of a worksheet?
Leave it as is
Erase the error and write the amount in the correct column
Highlight the error
Add the amount to the correct column without erasing
What accounting concept is applied when a word processing service business reports revenue per page one year and revenue per hour the next year?
Consistent Reporting
Matching Expenses
Revenue Recognition
Materiality
What is the amount of supplies used during a fiscal period classified as?
Revenue
Expense
Asset
Liability
What is the debit balance for the 'Cash' account as listed in the general ledger for Cradle Mountain Corporation on December 31?
$9,000.00
$1,800.00
$3,000.00
$100.00
Which account has a credit balance of $8,200.00 in the general ledger for Cradle Mountain Corporation on December 31?
Accounts Payable—Mooka Company
Matthew Hinz, Capital
Sales
Accounts Payable—Queenstown Supply
What is the adjustment amount for 'Supplies on hand' as of December 31?
$700.00
$1,600.00
$3,000.00
$850.00
What is the ending balance of prepaid insurance as of December 31?
$1,800.00
$1,600.00
$850.00
$550.00
Which account has a debit balance of $290.00 in the general ledger for Cradle Mountain Corporation on December 31?
Advertising Expense
Miscellaneous Expense
Rent Expense
Utilities Expense
What is the total debit adjustment for Supplies Expense as shown in the worksheet?
4,600
3,000
5,500
2,400
On October 31, what is the debit amount posted for Insurance Expense in the journal?
530
550
150
140
What is the total credit amount posted for Supplies in the journal?
4,600
3,000
550
140
Which account title is associated with a debit adjustment of 4,600 in the worksheet?
Supplies
Prepaid Insurance
Insurance Expense
Miscellaneous Expense
Which accounting term refers to a financial statement showing the revenue and expenses for a fiscal period?
Balance sheet
Income statement
Trial balance
Adjustments
What is the term for cash paid for an expense in one fiscal period that is not used until a later period?
Accrual basis of accounting
Prepaid expense
Net income
Fiscal year
Which accounting term refers to a proof of the equality of debits and credits in a general ledger?
Trial balance
Adjusting entries
Fiscal period
Net loss
What is the term for a financial statement that reports the value of a business's assets, liabilities, and owner's equity on a specific date?
Income statement
Fiscal year
Balance sheet
Adjustments
Which accounting term refers to reporting income when it is earned and expenses when they are incurred?
Accrual basis of accounting
Cash basis of accounting
Net income
Fiscal period
What is the term for the difference between total revenue and total expenses when total expenses are greater?
Net income
Net loss
Fiscal year
Prepaid expense
Which accounting term refers to reporting income when the cash is received and expenses when the cash is paid?
Accrual basis of accounting
Cash basis of accounting
Adjustments
Fiscal period
What is the term for the length of time for which a business summarizes financial information and reports its financial performance?
Fiscal year
Fiscal period
Net income
Adjusting entries
Which accounting term refers to a fiscal period consisting of 12 consecutive months?
Fiscal period
Fiscal year
Net loss
Prepaid expense
What is the term for journal entries recorded to update general ledger accounts at the end of a fiscal period?
Adjustments
Adjusting entries
Trial balance
Net income
What is the term for the difference between total revenue and total expenses when total revenue is greater?
Net loss
Net income
Fiscal year
Prepaid expense
Which accounting term refers to a columnar accounting form used to summarize the general ledger information needed to prepare financial statements?
Trial balance
Work sheet
Adjustments
Fiscal period
What is the term for changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period?
Adjustments
Adjusting entries
Fiscal year
Net income
Which accounting concept is applied when making adjustments to general ledger accounts?
Matching Expenses with Revenue accounting concept
Historical Cost accounting concept
Consistency accounting concept
Materiality accounting concept
What does the balance of the Supplies account plus the value of supplies on hand equal?
The up-to-date balance of the Supplies account
The total expenses for the period
The adjusted balance of the Supplies account
The net income for the period
Which of the following are considered permanent records in accounting?
Journals, ledgers, and work sheets
Trial balances and income statements
Adjusting entries and closing entries
Financial statements and tax returns
If the Trial Balance columns are not equal and the difference is $50.00, what is the most likely error?
A $25.00 amount written in the wrong column
A $50.00 amount omitted from the ledger
A $50.00 amount written in the wrong account
A $25.00 amount omitted from the ledger
Where must adjusting entries be posted?
To the general ledger accounts
To the trial balance
To the income statement
To the balance sheet
What should be done if an amount is written in an incorrect column on a work sheet?
Draw a line through the incorrect amount and write the correct amount in the correct column
Erase the incorrect amount and write the correct amount in the same column
Highlight the incorrect amount and write the correct amount below it
Leave the incorrect amount and make a note of the correction
Which two accounts are affected by the adjustment for supplies?
Supplies and Supplies Expense
Supplies and Accounts Payable
Supplies Expense and Accounts Receivable
Supplies and Prepaid Expenses
How many financial statements are prepared from the information on the work sheet?
Two
Three
Four
One
If the difference between the totals of Debit and Credit columns on a work sheet can be evenly divided by 9, what is the most likely error?
An error in addition
An error in subtraction
An error in multiplication
An error in division
How is net income on a work sheet calculated?
By subtracting the Income Statement Debit column total from the Income Statement Credit column total
By adding the Income Statement Debit column total to the Income Statement Credit column total
By subtracting the Balance Sheet Debit column total from the Balance Sheet Credit column total
By adding the Balance Sheet Debit column total to the Balance Sheet Credit column total
What is the debit balance for the Cash account in the general ledger for Hobart Corporation on December 31?
$9,500.00
$50.00
$400.00
$950.00
Which account has a credit balance of $6,950.00 in the general ledger for Hobart Corporation on December 31?
Dennis Hobart, Drawing
Dennis Hobart, Capital
Accounts Payable—Darwin Company
Accounts Receivable—Grand Company
What is the adjustment value for supplies on hand as of December 31?
$450.00
$100.00
$950.00
$300.00
What is the ending balance of prepaid insurance as of December 31?
$450.00
$150.00
$300.00
$100.00
Which account has a debit balance of $1,160.00 in the general ledger for Hobart Corporation on December 31?
Rent Expense
Utilities Expense
Supplies Expense
Advertising Expense
What is the credit balance for Accounts Payable—Darwin Company in the general ledger for Hobart Corporation on December 31?
$175.00
$400.00
$6,950.00
$8,000.00
What is the debit balance for Advertising Expense in the general ledger for Hobart Corporation on December 31?
$250.00
$150.00
$300.00
$15.00
What is the total debit amount for Supplies Expense as shown in the journal for October 31?
$550
$140
$675
$530
Which account has a credit adjustment of $15,000 in the work sheet for October 31?
Supplies
Prepaid Insurance
Insurance Expense
Rent Expense
What is the purpose of journalizing and posting adjusting entries in accounting?
To record transactions that occurred during the month
To ensure the accounts reflect accurate balances at the end of the period
To prepare financial statements for the next month
To calculate the total revenue for the month
What is the total credit adjustment for Supplies in the work sheet for October 31?
$675
$550
$140
$15,000
Which account title is associated with a debit adjustment of $150 in the work sheet for October 31?
Supplies Expense
Prepaid Insurance
Miscellaneous Expense
Rent Expense
What is the balance for the Supplies account as of October 31?
$8,600
$6,750
$18,500
$9,000
What is the debit amount recorded for the Prepaid Insurance account on October 31?
$15,000
$7,500
$9,000
$6,750
Which account has a balance of $15,000 as of October 31?
Supplies
Prepaid Insurance
Insurance Expense
Supplies Expense
What is the credit amount recorded for the Supplies Expense account on October 31?
$6,750
$15,000
$8,600
$7,500
Which account has a debit amount of $15,000 recorded on October 31?
Supplies
Prepaid Insurance
Insurance Expense
Supplies Expense
