Accounting Test #2 Chapter 4 Study Quiz

What is the major difference between the unadjusted trial balance and the adjusted trial balance? A) the adjusted trial balance will be used to record the adjustments for the period B) the adjusted trial balance includes the postings of the adjustments for the period in the balance of the accounts

Accumulated Depreciation appears on the A) balance sheet in the long-term liabilities section B) balance sheet in the property, plant, and equipment section

Notes receivable due in 390 days appear on the A) balance sheet in the noncurrent assets section B) balance sheet in the current assets section

Unearned Fees appear on the A) balance sheet in the stockholders' equity section B) balance sheet as a current liability

Which one of the fixed asset accounts listed below will NOT have a related contra asset account? A) office equipment B) land C) delivery equipment D) building

Prepaid insurance is reported on the balance sheet as a A) current asset B) fixed asset

The first item appearing on the statement of retained earnings is A) net income B) dividends C) beginning balance of RE D) ending balance of RE

The statement of retained earnings should be prepared A) before income statement & after balance sheet B) before income statement & balance sheet C) after income statement & balance sheet D) after the income statement and before the balance sheet

The income statement should be prepared A) after the RE statement & before balance sheet B) after the balance sheet and before the RE statement C) before the RE statement & balance sheet

The classified balance sheet will show which asset subsections? A) current liabilities and short-term assets B) current assets and other equity C) current assets and property, plant, and equipment

Debts listed as current liabilities are those that A) are due to be paid in more than one year B) will be paid in less than one year

Assets = _________ - _________ A) liabilities; stockholder's equity B) stockholder's equity; liabilities

Balance sheet accounts A) represent amounts accumulated during a specific period of time B) are called real accounts

On which financial statement will income summary be shown A) balance sheet B) no financial statement C) retained earning statement

Which of the following is NOT true about closing entries A) there are four closing entries that update the stockholders equity account B) after the second closing entry, the income summary account is equal to the net income or loss for the period C) all real accounts are closed at the end of a period

The income summary account is also A) the clearing account B) the adjustments account C) the zero-out account

After posting the second closing entry to the income summary account, the balance will be equal to A) zero B) the net income or net loss for the period

Which of the following account groups are nominal accounts A) common stock, dividends, income summary B) prepaid insurance, equipment, fees earned C) rent revenue, fees earned, miscellaneous expense

There are four closing entries. Order them: A) close dividends B) close income summary C) close revenues D) close expenses

Closing entries are dated in the journal as of A) the first day of the subsequent accounting period B) the last day of the accounting period C) the date they are actually journalized, although they are generally prepared after the end of the accounting period

Which of the accounts below would be closed by posting a debit to the account? A) dividends B) miscellaneous expense C) fees earned

Which of the following accounts should be closed to income summary at the end of the fiscal year A) service revenue B) equipment C) prepaid insurance D) unearned rent

Which of the following accounts will NOT be closed to income summary at the end of the fiscal year? A) utilities expense B) fees earned C) prepaid insurance D) insurance expense

The entry to close the appropriate insurance account at the end of the accounting period is A) debit income summary; credit prepaid insurance B) debit income summary; credit insurance expense

Which of the following accounts ordinarily appears in the post-closing trial balance A) supplies expense B) dividends C) unearned rent D) fees earned

Diane's Designs purchased a one-year liability insurance policy on March 1st of a year for $8,400 and recorded it as a prepaid expense. One month of rent cost $700. Which of the following amounts would be recorded as insurance expense during the adjusting process at the end of Diane's first month of operations on March 31st? A) $7,700 B) $8,400 C) $700 D) $840

The accounting cycle requires three trial balance be done. In what order should they be prepared? A) adjusted B) post-closing C) unadjusted

The natural business year is a A) fiscal year that ends when business activities are at their lowest points B) calendar year that ends when business activities are at their lowest points C) fiscal year that ends when business activities are at their highest point D) calendar year that ends when business activities are at their highest point