Question 1

Changes in owner\'s equity that result from investments or withdrawals of assets by the owner are included in the

Accepted Answer

Statement of Owner\'s Equity

Question 2

Owner\'s equity can be increased through

Accepted Answer

Investments by owner

Question 3

The balance in an expense account is closed to a(n)

Accepted Answer

Income Summary Account

Question 4

The order in which financial statements should be prepared is

Accepted Answer

Income Statement, Statement of Owner\'s Equity, and Balance Sheet

Question 5

After the closing entries are journalized and posted, which accounts would NOT have a balance

Accepted Answer

Temporary accounts

Question 6

A form of balance sheet that lists the liabilities and the owner\'s equity sections below the assets section is called

Accepted Answer

Report Form

Question 7

After the accounts are closed and the journal entries have been posted, which of the following accounts would have a balance

Accepted Answer

Permanent accounts (assets, liabilities, ; owners capital)

Question 8

The amount reported in the Balance Sheet columns of the work sheet for the owner\'s capital represents the

Accepted Answer

The beginning balance plus additional investments

Question 9

When recording closing entries in the general journal, what is written in the Description column

Accepted Answer

Closing Entries

Question 10

To prove the equality of the debit and credit balances in the general ledger accounts after the closing entries have been journalized and posted, prepare the

Accepted Answer

Post-Closing Trial Balance

Question 11

The journal entry to close the income summary account (showing a net loss) includes

Accepted Answer

Debiting the owner\'s capital account and crediting Income Summary

Question 12

The journal entry to close expense accounts includes

Accepted Answer

Debiting Income Summary and crediting the expense account

Question 13

The journal entry to close revenue accounts includes

Accepted Answer

Debiting the revenue accounts and crediting income summary

Question 14

Which step is taken at the end of the accounting period

Accepted Answer

Prepare a post-closing trial balance.

Question 15

Know the steps of the accounting cycle in the correct order

Accepted Answer

1. Analyze source documents.  2. Journalize the transactions.  3. Post to the general ledger.  4. Prepare trial balance.  5. Determine ; prepare the needed adjustments on the work sheet.  6. Complete end of period work sheet.  7. Journalize and post the adjusting entries.  8. Prepare income statement, statement of owner\'s equity, and a balance sheet.  9. Journalize and post the closing entries.  10. Prepare a post-closing trial balance.

Question 16

The journal entry to close the income summary account (showing a profit) includes

Accepted Answer

Debiting Income Summary and crediting the owner\'s capital account

Question 17

What is the correct sequence for closing the temporary accounts

Accepted Answer

Revenue accounts, expense accounts, Income Summary, and drawing account

Question 18

The steps involved in handling all of the transactions and events completed during an accounting period, beginning with placing data in a book of original entry and ending with a post-closing trial balance, are referred to collectively as

Accepted Answer

The accounting cycle

Question 19

The Income Summary account is used to

Accepted Answer

Close revenue accounts and expense accounts and update the owner\'s capital account

Question 20

The journal entry to close the drawing account includes

Accepted Answer

Debit the capital account and credit the drawing account.

Question 21

What is the purpose of the post-closing trial balance

Accepted Answer

To prove the equality of the debit and credit balances in the general ledger accounts.

Question 22

Cash and other assets that will be converted into cash within one year or the normal operating cycle of the business, whichever is longer, are called

Accepted Answer

Current assets

Question 23

The account to which revenue and expenses are closed is called

Accepted Answer

Income Summary

Question 24

The account to which the drawing account is closed is called

Accepted Answer

Owner\'s Capital

Question 25

A balance sheet that groups similar items is called a(n)

Accepted Answer

Classified balance sheet

Question 26

The body of the income statement consists of an itemized list of

Accepted Answer

Revenues and expenses

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