During the closing process, Accumulated Depreciation--Equipment will a] be closed to the income summary account b] be closed to the capital account c. the income statement debit column Assume a company has equipment which is used in its business. d. the income statement credit column, On the worksheet, the balance sheet columns should balance: Trial balances are prepared in a certain order. D. asset accounts should be indented. B. In Exercises 212121 through 303030, find the indicated integral. C. a debit to Equipment for $100 and a credit to Accounts Payable for $400. b. prepare the post closing trial balance d. There may have been additional revenue made during the year reflected in the balance. B. a. A. D. Joan Wilson, Drawing. c. the balance sheet debit column Accumulated depreciation is the cumulative depreciation of an asset up to a single point in its life. Establish zero balance in each of the temporary accounts to start the accumulation in the next period. B. will be understated. A. be reported on the Income Statement. A. Accounts Receivable, Accumulated Depreciation, Accounts Payable d. correcting entries, If a business has a net loss for a fiscal period, the journal entry to close the income summary account is: C. owner's capital account and a credit to the owner's drawing account. a. A. adjusting entries are not required. We need to do the closing entries to make them match and zero out the temporary accounts. B. updating entries for previously unrecorded expenses or revenues. b. be reported on the statement of owner's equity ppp-value and the 95 percent confidence interval for the slope shown in the regression results. d. must always be adjusted to the calendar year. b. is not characterized by any of these answer choices. D. are recorded in the journal and then posted to the general ledger accounts. One purpose of closing entries is to: transfer the results of operations to owner's equity. & \textbf{Edge} & \textbf{GoBee}\\ (1) Generally Accepted Accounting Principles in the United States. Accounts Payable All transactions are recorded first in the general ledger and then they are journalized in the journal. Accumulated Depreciation-Equipment c. Supplies Expense d. Revenue; The journal entry to record the sale of services on credit should include The balance in the Prepaid Rent account before adjustment at the end of the year is $12,000, which represents six months rent paid on November 1. Ref. A. d. Adjusting entries must be journalized and posted before the closing entries are journalized and posted, Which of the following statements is not correct? Which of the following account groups includes temporary (nominal) accounts? b. a. the excess of the current liabilities of a business over its current assets. A. a $4,000 debit to Prepaid Rent. Debit cash; credit supplies a. recorded in the income statement debit column A company's capital assets may include: Equipment. Terry James, Drawing and Unearned Revenue 20XX Account Debit Credit Cash $35,825 Accounts Receivable 2,500 Interest Receivable 350 Supplies 250 Equipment 45,000 Accumulated Depreciation $2,500 Acounts Payable 5,500 Unearned Revenue 2,100 Income Taxes Payable . Debit Accounts Payable b. B. A. Debit to Cash; Credit Supplies Real accounts T 16. expenses hich of the following is the last step during the posting process? The amount of accumulated depreciation for an asset will . Accumulated Depreciation B. Debit Income Summary $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. c. credit to Fees Earned. A. c. only a balance sheet is required If a business has a net loss for a fiscal period, the journal entry to close the Income Summary account is By matching revenues and expenses in the same period in which they incur, net income or loss will be properly reported on the income statement, Supplies are recorded as assets when purchased. a. cash payments journal c. Cash, Accounts Receivable, Supplies When the trial balance totals are not equal, the error may have been caused by recording a debit as a credit if the difference is divisible by \text { Investment } . Prepaid Rent..8,000 c. Step 1: Analyzing and recording transactions in the journal Accounts Payable D. the total dollar amount debited will equal the total dollar amount credited. d. journalize and post the adjusting entries, In a firm that uses special journals, a sale of merchandise on credit is recorded in the: D. the company has earned a net income. Credit Supplies. After closing entries are posted, the revenue, expense and drawing accounts will have zero balances c. after the net income amount is added to the balance sheet credit column a. be reported on the income statement B. assets, liabilities, and owner's equity \text{Inventories} & 202,000 & 199,000\\ Example of Depreciation Accounts. Step 10: Preparing a post-closing trial balance Equipment 36,600. Which of the following statements is not correct? Accounts Receivable c. debit revenue $64000; credit expenses $53000 d. purchases journal, In a firm that uses special journals, the acceptance of a return of merchandise from a credit customer is recorded in the: \text { of the Period } . c. cash payments journal b. A. Debit Accounts Receivable $1,350; credit Cash $1,350 January six is the d. T. Stark, drawing, Which of the following statements is correct? The entry to close the revenue account Fees Income requires a debit to that account. D. the income statement and the balance sheet. 3. assets liabilities and owner's equity are permanent (real) accounts and do not get closed at the end of the period, the post-closing trial balance will generally have fewer accounts than the trial balance, what is the first account that should be listed in the post-closing trial balance. d. are recorded in the journal and then posted to the general ledger accounts, One purpose of closing entries is to give zero balances to: Debit Credit Cash $2,260 Accumulated Depreciation-Equipment $1,860 Accounts Receivable 4,110 Accounts Payable 2,460 Supplies 1,660 Unearned Revenue 1,060 Equipment 11,860 Salaries Payable 560 J. Williams, Capital 13,950 $19,890 $19,890 During November, the following summary transactions were completed. Unearned Subscriptions 11,500 A. an asset with a credit balance Credit Cash, all of the information from the journal was correctly transferred to the ledger, Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means, Smith Inc. Accounts Payable 2,000 Wages of $11,000 are earned by workers but not paid as of December 31. b. d. Step 6: Journalizing and posting adjusting entries, When the end-of-period spreadsheet is complete, the adjustment columns should have. Cost of Goods Sold explanation, calculation, historical data and more $8,400 B. D. Debit Penny Pincher, Capital; credit Penny Pincher, Drawing, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Don Herrmann, J. David Spiceland, Wayne Thomas, Daniel F Viele, David H Marshall, Wayne W McManus, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. working capital = current assets- current liabilities, Current assets divided by current liabilities. d. None of these choices are correct. A. $9,732 Od. \text{Preferred stock, 5\\\%, \$125 par} && 25,000\\ A. will be overstated. A. A. a debit to Equipment for $100 and a credit to Cash for $100. Trial balance, adjusted trial balance, post-closing trial balance. C. All credited accounts are listed first and then all debited accounts are indented and listed on the next lines. A. 4. To account for this decrease in usefulness, the cost of fixed assets is systematically allocated to expense through a process called, The unexpired insurance at the end of the fiscal period represents, An end-of-period spreadsheet includes columns for, is used to summarize account balances and adjustments for the financial statements, How will the following adjusting journal entry affect the accounting equation? Divide the sum of step (2) by the number arrived at in step (3) to get the annual depreciation amount. A. An asset's carrying value on the balance sheet is the difference between its purchase price . c. C. Post-closing trial balance, adjusted trial balance, trial balance. c. Has the business achieved its net income goal for the year? b. d. accounts payable, Which of the following statements is not correct? You have narrowed the choice to either Edge Corporation stock or GoBee Company stock and have assembled the following data for the two companies. \text{Net income} &69,000 & 36,000\\ d. the financial statements are prepared using the worksheet data, Which of the following statements is NOT correct? a. equipment C. Debit Fees Income $1,350; credit Cash $1,350. A. To illustrate accounting for the sale of a plant asset, assume that a company sells equipment costing $45,000 with accumulated depreciation of $ 14,000 for $28,000 cash. d. the expense accounts, The first two closing entries to the income summary account indicate a debit of $53000 and a credit of $64000. b. Prepaid Insurance, Supplies, Office Equipment Accounts Payable has a January 5 credit entry of 3,500, a January 13 debit entry of 3,500, a January 30 credit entry of 500 . d. Revenue accounts, Which of the following accounts will be closed with a debit? The revenue account Fees Income is closed by debiting. Land d. rent expense, One purpose of closing entries is to: \text{Income from operations} & 89,000 & 73,000\\ Depreciation on equipment acquired on July 1 amounted to $ 4,000. A. a debit to Income Summary and a credit to the owner's capital account. Enter the date of the transaction in the ledger account. Calculate the earnings per share of common stock for both companies for the current year, and decide which companys stock better fits your investment strategy. Equipment: 20,000: Accumulated Depreciation - Building $-0-Accumulated Depreciation - Equipment-0-Accumulated Depreciation - Furniture-0-Accounts Payable: 4,400: Salaries Payable-0-Interest Payable-0-Unearned Commissions Revenue: 1,200: Unearned Subscriptions Revenue: 800: Bank Loan: 47,600: Share Capital: 52,100: Retained Earnings-0 . d. At the time of their acquisition, prepaid expenses are recorded in expense accounts, On a worksheet, the adjusted balance of the prepaid rent account is extended to the: d. 5, After the closing entries are posted to the ledger, each revenue account will have: Can we draw the conclusion that the mean is different from 100 at the.05 level of significance? Over time, the accumulated depreciation balance will continue to increase . C. prepare the post-closing trial balance. Debit supplies; Credit accounts payable Information in the financial statements provides answers to many questions, including: . b. internationalism Company vehicles. c. The Supplies account had a $390 debit balance at the beginning of the year. During the closing process, what amount was transferred from the income summary account to the Retained Earnings account in the third closing entry (i.e., after revenue and expense accounts have been closed to Income Summary B. be reported on the Statement of Owner's Equity. If a journal entry that contains an error has already been posted, D)be closed to the capital account. Debit cash; credit fees earned H0:=100H1:100\begin{aligned} Financial Accounting & Analysis -N (1A) - Read online for free. Oa. a. prepare the financial statements c. The balance of the owner's capital account, as reflected on the postclosing trial balance, will match the amount reported on the income statement If an amount box does not require an entry, leave it blank. C. Placing the balance in Prepaid Rent in the Credit column On November 25, 2016, the company paid $24,000 rent in advance for a six-month period (December 2016 through May 2017). A debit to Income Summary and a credit to Fees Income. Depreciation of equipment during the year $3,400 c) Rent expired during the year $11,000 d) Wages accrued, but not paid at August 31 $2,500 . The cost of supplies used is reported on the statement of owner's equity 6-6 2. A. are posted to the ledger but are not recorded in the journal. 6-30 If the postclosing trial balance does not balance, the accounting records contain d. either a debit or a credit balance, A postclosing trial balance could include all of the following except the: When pulling the owner's capital balance from the end-of-period spreadsheet into the statement of owner's equity, why is it also important to check the detail in the owner's capital account in the general ledger? A firm purchased telephone equipment for cash. During the closing process, Accumulated Depreciation, Equipment will be closed to the income summary account. b. the depreciation expense account and a credit to the accumulated depreciation account c. the balance sheet owner's equity c. foreign policy C. on the left side of the Cash account and the right side of the Accounts Receivable account. Fees Earned 6,375, decrease liabilities, increase net income, increase revenues reported for the period, The difference between the balance of a fixed asset account and the related accumulated depreciation account is termed, Prepaid rent, representing rent for the next six months' occupancy, would be reported on the tenant's balance sheet as a(n), As time passes, fixed assets other than land lose their capacity to provide useful services. \hline \begin{array}{c} Financial statements cannot be prepared correctly until all the accounts have been adjusted. d. the income statement credit column, On a worksheet, a net loss is: Explain your conclusion. Ans.4: The as an income summary accounts close the records of revenues and expenses for an accounting period. Depreciation accounts for an expense on an asset over time, it has nothing to do with the decrease in value of an asset. C. Accumulated Depreciation--Equipment is presented in the Liabilities section of a balance sheet. A fleet of refrigerated delivery trucks is acquired on January 5, 2017, at a cost of $830,000 with an estimated useful life of eight years and an estimated salvage value of$75,000. d. Joan Wilson, capital, Entries required to zero the balances of the temporary accounts at the end of the year are called: c. cash and a credit to the income summary account During the year, no additional Common stock was issued. The cost of equipment is recorded in the account Equipment. D. owner's drawing account and a credit to the Income Summary account. b. cash receipts journal During the closing process, Accumulated Depreciation--Equipment will. b. the income summary and a credit to cash A. a debit to Cash for $1,500, a debit to Accounts Receivable for $3,500 and a credit to Fees Income for $5,000. The audit trial should be used to trace data through the accounting records to find and correct errors c. the owner's capital account C. a $1,000 debit to Rent Expense; a $1,000 credit to Prepaid Rent. Depreciation expense is the amount that a company's assets are depreciated for a single period (e.g . b. A. journalize the closing entries. c. rent expense There may have been additional losses incurred during the year reflected in the balance. D. the expense accounts. Step 1: Close Revenue accounts. VIDEO ANSWER: I would like to welcome everyone. b. be closed to the capital account After the closing entries are posted to the ledger, each expense account will have, Chapter 4: The General Journal and the Genera, Fundamentals of Financial Management, Concise Edition, Jack R. Kapoor, Les R. Dlabay, Melissa Hart, Robert J. Hughes, Carl S Warren, James M Reeve, Jonathan E. Duchac. C. A post-closing trial balance will not contain revenue and expense account balances. Find the greatest common divisor (GCD)for the following then simplify the fraction. \text{Cost of goods sold} & 452,000 & 388,000\\ d. worksheet, After the worksheet has been completed, the next step in the accounting cycle is to: Depreciation of automobile, ten-year useful life, P100,000 estimated residual value per vehicle. B. adjusting entries. During the closing process, Accumulated Depreciation, Equipment will. Business Accounting the estimated amount of depreciation on equipment for a period is $3,500, the adjusting entry to record depreciation would be a. debit Depreciation Expense $3,500; credit Accumulated Depreciation $3,500. Step 7: Preparing the financial statements c. 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