Question 1

What is the result if the amount of net income for the year is less than the amount of the owner's withdrawals?
A)Owner,Capital increases
B)Cash balance decreases
C)Cash balance increases
D)Owner,Capital decreases

Accepted Answer

If the amount of net income for the year is less than the amount of the owner's withdrawals, it indicates that the business has incurred a loss. As a result, the owner's withdrawals will exceed the net income, meaning the business has fewer funds available to distribute to the owner. This results in a decrease in the owner's capital. Additionally, if the owner had to dip into the cash balance to cover the excess withdrawals, it would result in a decrease in the cash balance as well.

Question 2

Dogwood Company earned revenues of $19,000 and incurred expenses of $7,000.The owner made withdrawals of $3,500.What is the balance in the Income Summary account prior to closing net income or loss to the Owner,Capital account?
A)debit balance of $12,000
B)debit balance of $8,500
C)credit balance of $12,000
D)credit balance of $19,000

Accepted Answer

C)
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Question 3

GAAP requires publicly traded companies to prepare a post-closing trial balance and publish it in their annual report.

Accepted Answer

While GAAP requires publicly traded companies to prepare financial statements in accordance with GAAP, including a balance sheet, income statement, and statement of cash flows, it does not specifically require a post-closing trial balance to be published in the annual report.

Question 4

The net income of Harriet Company for the year is $25,000.The owner made withdrawals during the year of $30,000.Which of the following statements is true?
A)Owner,Capital account decreases by $25,000.
B)Owner,Capital account decreases by $5,000.
C)Owner,Capital account increases by $30,000.
D)Owner,Capital will remain the same.

Accepted Answer

B)
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Question 5

The following is the adjusted trial balance for Becker Photography.

After the closing entries,what will the final balance in R.Becker,Capital be?
A)$23,000
B)$179,200
C)$27,500
D)$156,200

Accepted Answer

D)
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Question 6

The following is the adjusted trial balance as of December 31,2017 of Martin Watch Company:
  
Provide the closing entry for revenues.

Accepted Answer

The answer of The following is the adjusted trial balance...

Question 7

The post-closing trial balance shows the net income for the period just ended.

Accepted Answer

The post-closing trial balance only includes balance sheet accounts, not income statement accounts such as revenue and expenses. Therefore, it does not show net income for the period.

Question 8

The post-closing trial balance shows the updated Owner,Capital balance.

Accepted Answer

The post-closing trial balance includes all the accounts after the closing entries have been made, including the final updated Owner's Capital account balance.

Question 9

The following is the adjusted trial balance as of December 31,2017 of Current Times Watch Co.:
  
Provide the closing entry for the Income Summary account.

Accepted Answer

The answer of The following is the adjusted trial balance...

Question 10

Rosewood earned revenues of $19,000 and incurred expenses of $4,500.The owner made withdrawals of $2,500.What is the balance in the Income Summary account after closing net income or loss to the Owner,Capital account?
A)debit balance of $19,000
B)credit balance of $4,500
C)credit balance of $14,500
D)balance of $0

Accepted Answer

D)Net Income will be transferred to Retained Earnings account.
The balance in the Income Summary account after closing Net Income or Loss is $0.

Question 11

Which accounts are closed at the end of the accounting period? Why is it necessary to close these accounts?

Accepted Answer

The answer of Which accounts are closed at the end...

Question 12

Emerald Company earned revenues of $69,000 and incurred expenses of $77,000.No dividends were declared.Which of the following statements is correct?
A)The entry to close Income Summary is the same regardless of a net income or a net loss.
B)Owner,Capital will be debited for $8,000 and Income Summary will be credited for $8,000.
C)The entries to close revenues and expenses will differ if there is a net loss.
D)The entry to close Income Summary requires a debit to the Income Summary account.

Accepted Answer

The answer of Emerald Company earned revenues of $69,000 and...

Question 13

Which of the following entries will be necessary to close the Insurance Expense account at the end of the year?
A)debit Insurance Expense and credit Income Summary
B)debit Insurance Expense and credit Owner,Capital
C)debit Owner,Capital and credit Insurance Expense
D)debit Income Summary and credit Insurance Expense

Accepted Answer

The Insurance Expense account is a temporary account that needs to be closed at the end of the year to transfer its balance to the Owner's Equity section. To do this, we need to debit the Income Summary account (which is used to summarize all the revenues and expenses for the year) and credit the Insurance Expense account for the balance. Therefore, the correct entry is to debit Income Summary and credit Insurance Expense.

Question 14

The following is the adjusted trial balance as of December 31,2017 of Piedmont Exteriors:
  
Provide the closing entry for the Income Summary account.

Accepted Answer

The answer of The following is the adjusted trial balance...

Question 15

The following is the adjusted trial balance as of December 31,2016 of Aims Photography:
  
Provide the closing entry for expenses.

Accepted Answer

The answer of The following is the adjusted trial balance...

Question 16

The following is the adjusted trial balance as of December 31,2016 of Mason Photography:
  
Provide the closing entry for revenues.

Accepted Answer

The answer of The following is the adjusted trial balance...

Question 17

Refer to the following adjusted trial balance.

What will the final ending balance in the Owner,Capital account be after posting the closing entries?
A)$23,800
B)$25,800
C)$29,300
D)$27,800

Accepted Answer

A)
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Question 18

The following is the adjusted trial balance as of December 31,2017 of Peri Brothers Co.:
  
Provide the closing entry for expenses.

Accepted Answer

The answer of The following is the adjusted trial balance...

Question 19

Which of the following accounts has a balance equal to net income immediately before it is closed?
A)Income Summary
B)Owner,Withdrawals
C)Net Income
D)Owner,Capital

Accepted Answer

Income Summary account is used to summarize all the revenue and expense accounts at the end of an accounting period. Its balance is equal to net income before it is closed. This balance is then transferred to the owner's equity account such as Owner, Capital or retained earnings. Therefore, the balance of Income Summary account represents net income for the period.

Question 20

James Service Company earned revenues of $100,000 and incurred expenses of $107,000.Prepare the entry to close the Income Summary account.

Accepted Answer

The answer of James Service Company earned revenues of $100,000...

Quiz 4: Completing the Accounting Cycle

What is the result if the amount of net income for the year is less than the amount of the owner's withdrawals?

Dogwood Company earned revenues of $19,000 and incurred expenses of $7,000.The owner made withdrawals of $3,500.What is the balance in the Income Summary account prior to closing net income or loss to the Owner,Capital account?

GAAP requires publicly traded companies to prepare a post-closing trial balance and publish it in their annual report.

The net income of Harriet Company for the year is $25,000.The owner made withdrawals during the year of $30,000.Which of the following statements is true?

The following is the adjusted trial balance for Becker Photography. After the closing entries,what will the final balance in R.Becker,Capital be?

The following is the adjusted trial balance as of December 31,2017 of Martin Watch Company: Provide the closing entry for revenues.

The post-closing trial balance shows the net income for the period just ended.

The post-closing trial balance shows the updated Owner,Capital balance.

The following is the adjusted trial balance as of December 31,2017 of Current Times Watch Co.: Provide the closing entry for the Income Summary account.

Rosewood earned revenues of $19,000 and incurred expenses of $4,500.The owner made withdrawals of $2,500.What is the balance in the Income Summary account after closing net income or loss to the Owner,Capital account?

Which accounts are closed at the end of the accounting period? Why is it necessary to close these accounts?

Emerald Company earned revenues of $69,000 and incurred expenses of $77,000.No dividends were declared.Which of the following statements is correct?

Which of the following entries will be necessary to close the Insurance Expense account at the end of the year?

The following is the adjusted trial balance as of December 31,2017 of Piedmont Exteriors: Provide the closing entry for the Income Summary account.

The following is the adjusted trial balance as of December 31,2016 of Aims Photography: Provide the closing entry for expenses.

The following is the adjusted trial balance as of December 31,2016 of Mason Photography: Provide the closing entry for revenues.

Refer to the following adjusted trial balance. What will the final ending balance in the Owner,Capital account be after posting the closing entries?

The following is the adjusted trial balance as of December 31,2017 of Peri Brothers Co.: Provide the closing entry for expenses.

Which of the following accounts has a balance equal to net income immediately before it is closed?

James Service Company earned revenues of $100,000 and incurred expenses of $107,000.Prepare the entry to close the Income Summary account.