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Chapter Quiz
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1
The first step in the closing process is to close the revenue account(s) into the Income Summary account.
A)True
B)False
2
The fourth step in the closing procedure is to close the Income Summary account into the Capital account.
A)True
B)False
3
Closing entries may be prepared from the ledger or the work sheet.
A)True
B)False
4
After the temporary accounts are closed, only the real accounts have balances.
A)True
B)False
5
Entries required to clear or zero the balances of the temporary accounts at the end of the year are called closing entries.
A)True
B)False
6
The purpose of the post-closing trial balance is to make sure the debit balances equal the credit balances.
A)True
B)False
7
If a business has a net loss for a fiscal period, the journal entry to close the Income Summary account is a debit to Capital and a credit to Income Summary.
A)True
B)False
8
Information for the closing entries is normally obtained from the Adjusted Trial Balance columns of a work sheet.
A)True
B)False
9
Both income statement and balance sheet accounts are closed at the end of a fiscal period.
A)True
B)False
10
A post-closing trial balance will include only nominal accounts.
A)True
B)False
11
A post-closing trial balance will include the Cash account.
A)True
B)False
12
To close all of the Revenue Accounts, the Income Summary account is credited.
A)True
B)False
13
To close all of the Expense Accounts, the Income Summary account is credited.
A)True
B)False
14
Accumulated Depreciation is closed in the second closing entry
A)True
B)False
15
The second step in the closing process is to close the expense accounts to the Income Summary account
A)True
B)False
16
Which of the following accounts would not be involved in closing entries?
A)Advertising Expense
B)Salaries Payable
C)Income from Services
D)B. Ryan, Drawing
E)none of these
17
Financial statements can be prepared
A)monthly.
B)annually.
C)quarterly.
D)all of these.
E)none of these.
18
The post-closing trial balance is best prepared from
A)the financial statements.
B)the general ledger.
C)the general ledger and the financial statements.
D)the general journal and the general ledger.
E)none of these.
19
In preparing the first two closing entries, to which of the following columns of the work sheet does one refer?
A)Income Statement columns
B)Balance Sheet columns
C)Trial Balance columns
D)Adjusted Trial Balance columns
E)none of these
20
If L. Jones' total revenue for the year was $38,000 and total expenses were $30,000, the third closing entry would be
A)debit Income from Services; credit Income Summary.
B)debit L. Jones, Capital; credit Income Summary.
C)debit Income Summary; credit Income from Services.
D)debit Income Summary; credit L. Jones, Capital.
E)none of these.
21
Which of the following accounts should be closed to J. Born, Capital, in the fourth closing entry?
A)Professional Fees
B)J. Born, Drawing
C)Wages Expense
D)Income Summary
E)none of these
22
Which of the following can be prepared by taking the account balances from the general ledger after closing?
A)Post-closing trial balance
B)Statement of owner's equity
C)Income statement
D)Adjusted Trial Balance
E)all of these
23
Which of the following accounts should be closed to Income Summary at the end of the fiscal year?
A)Rent Expense
B)Income from Services
C)Professional Fees
D)all of these
E)none of these
24
The most efficient sources for closing entry information are
A)ledger and work sheet.
B)work sheet and financial statements.
C)ledger and journal.
D)journal and work sheet.
E)none of these.
25
Which of the following accounts in the ledger will ordinarily appear in the post-closing trial balance?
A)Income from Services
B)Supplies Expense
C)Drawing
D)Accounts Receivable
E)none of these
26
If expenses are greater than revenue, the Income Summary account will be closed by a debit to
A)Income Summary and a credit to Cash.
B)Income Summary and a credit to Capital.
C)Capital and a credit to Income Summary.
D)Cash and a credit to Income Summary.
E)none of these.
27
Closing entries are prepared to
A)close the expense accounts.
B)close the income accounts.
C)close the Income Summary and transfer the profit or loss to Capital.
D)close Drawing.
E)do all of these.
28
The last step in the closing procedure
A)closes the expense accounts.
B)closes the Drawing account.
C)closes the Capital account.
D)closes the Income Summary account.
E)does none of these.
29
After temporary accounts have been closed at the end of the accounting period, which of the following accounts will still have a balance
A)A Wages Expense.
B)B. Wages Payable.
C)C. Service Revenue
D)D. Utilities Expense.
E)none of these.
30
Which of the following sequences of documents or records describes the proper sequence in the accounting cycle?
A)source documents, journal, ledger, work sheet, financial statements
B)source documents, ledger, journal, work sheet, financial statements
C)work sheet, source documents, financial statements, ledger, journal
D)source documents, work sheet, journal, ledger, financial statements
E)none of these





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