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Exam 4: Completing the Accounting Cycle

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Question 41

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Use the work sheet for Finley Company to answer the questions that follow. The journal entry to close revenues would be

A) debit Income Summary, $141,000; credit Fees Earned, $141,000
B) debit Retained Earnings, $141,000; credit Fees Earned, $141,000
C) debit Fees Earned, $141,000; credit Income Summary, $141,000
D) credit Fees Earned, $141,000; credit Retained Earnings, $141,000

E) A) and B)
F) B) and D)

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Question 42

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Unearned revenues that will be earned in a relatively short period of time are listed on the balance sheet as current assets.

A) True
B) False

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Question 43

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The trial balance prepared after all the closing entries have been posted is called a pre-closing trial balance.

Complete the following work sheet for Danilo Enterprises. Danilo Enterprises Work Sheet For the Year Ended December 31, 2011

The amount of the net income for a period appears on both the income statement and the balance sheet for that period.

The income statement should be prepared

The dividends account is closed to the income summary account.

The usual presentation of the retained earnings statement is (1) beginning retained earnings, (2) net income or loss, (3) dividends (4) ending retained earnings.

Which one of the steps below is not aided by the preparation of the work sheet?

A post-closing trial balance should be prepared before the financial statements are prepared.

Which of the following accounts should be closed to Income Summary at the end of the fiscal year?

The work sheet is considered a part of the formal accounting records.

After all adjustments have been made, but before the accounts have been closed, the following balances were taken from the ledger of Ramona's Designs: Journalize the entries to close the appropriate accounts.

The balances of the equity accounts from the Adjusted Trial Balance columns of the work sheet are extended to the Retained Earnings Statement columns.

A post-closing trial balance contains only asset and liability accounts.

Prepare an income statement and a retained earnings statement for the month ended September 30, 2011, from the T accounts below of Carson Company.

In a computerized accounting system, a work sheet may be necessary because the software program automatically posts entries to the accounts and prepares financial statements.

The following is the adjusted trial balance for Sandeep Company. Prepare closing entries and the post closing trial balance.

Which of the following is not true about closing entries?

Beachside Realty rents condominiums and furnishings. It's adjusted trial balance at December 31, 2011, is as follows: Prepare the entry required to close the dividends account at the end of the period.