In the accounting cycle, the last step is

A. preparing the financial statements

B. journalizing and posting the adjusting entries

C. preparing a post-closing trial balance

D. journalizing and posting the closing entries

During the end-of-period processing which of the following best describes the logical order of this
process

A. Preparation of adjustments, adjusted trial balance, financial statements

B. Preparation of Income Statement, adjusted trial balance, Balance Sheet

C. Preparation of adjusted trial balance, cross-referencing, journalizing

D. Preparation of adjustments, adjusted trial balance, posting

What is the major difference between the Unadjusted Trial Balance and the Adjusted Trial Balance?

A. The Adjusted Trial Balance will show the net income (loss) as an additional account.

B. Unlike the Adjusted Trial Balance, the Unadjusted Trial Balance will continue with the end-of-period
processing even if it is not in balance.

C. The Adjusted Trial Balance includes the postings of the adjustments for the period in the balance of
the accounts.

D. The Adjusted Trial Balance will be used to record the adjustments for the period.
Once the adjusting entries are posted, the Adjusted Trial Balance is prepared to

A. verify that the debits and credits are in balance.

B. verify that the net income correctly flows into the statement of owner’s equity from the income
statement

C. verify that the net income (loss) is correct for the period.

D. verify the correct flow of accounts into the financial statements.

Unearned Fees appear on the

A. balance sheet in the current assets section
B. balance sheet as a current liability
C. balance sheet in the owner's equity section
D. income statement as revenue

Prepaid insurance is reported on the balance sheet as a

A. current asset
B. fixed asset
C. current liability
D. long-term liability

The classified Balance Sheet will subsection the assets section as follows
A. Current Assets and Other Assets
B. Current Assets and Property, Plant, and Equipment
C. Current Assets and Short-Term Assets
D. Other Assets and Property, Plant and Equipment
The classified Balance Sheet will divide its Liabilities Section as the following subsections

A. Current Liabilities and Long-Term Liabilities

B. Current Liabilities and Other Liabilities

C. Other Liabilities and Long-Term Liabilities

D. Present Liabilities and Tomorrow’s Liabilities

On which financial statement will Income Summary be shown?

A. Statement of Owner’s Equity
B. Balance Sheet
C. Income Statement
D. No financial statement

Which of the following account groups are all considered nominal accounts?
A. Cash, Owner’s Equity, Wages Payable
B. Prepaid Insurance, Property, Plant & Equipment, Fees Earned
C. Capital Account, Dividend Account, Income Summary
D. Rent Revenue, Fees Earned, Miscellaneous Expense

Which of the following is not true about closing entries?

A. There are four closing entries that update the owner’s 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 the period.
D. By closing nominal accounts at the end of the period to zero, it is possible to isolate next period’s
information correctly.
There are four closing entries. The first one is to close ____, the second one is to close ____, the third
one is to close ____, and the last one is to close ____.

A. Revenues, expenses, income summary, drawing account

B. Expenses, assets, income summary, capital account

C. Capital account, drawing account, income summary, assets

D. Drawing account, income summary, expenses, revenues

Which of the accounts below would be closed by posting a debit to the account?
A. Unearned Revenue
B. Fees Earned
C. Josh Morton, Drawing
D. Miscellaneous Expense

Which of the following accounts should be closed to Income Summary at the end of the fiscal year?
A. Supplies Expense
B. Accumulated Depreciation
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. Salaries Expense
B. Fees Earned
C. Unearned Rent
D. Depreciation 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 Prepaid Insurance; credit Income Summary
C. debit Insurance Expense; credit Income Summary
D. debit Income Summary; credit Insurance Expense

The post-closing trial balance differs from the adjusted trial balance in that it
A. does not take into account closing entries
B. does not take into account adjusting entries
C. does not include balance sheet accounts
D. does not include income statement accounts
The following accounts were taken from the Adjusted Trial Balance columns of the work sheet:

Accumulated Depreciation $ 3,200

Fees Earned 17,400

Depreciation Expense 1,300

Insurance Expense 200

Prepaid Insurance 4,800

Supplies 900

Supplies Expense 3,800

Net income for the period is

A. $3,200
B. $12,100
C. $17,400
D. $8,900

The proper sequence of steps in the accounting cycle is as follows

A. analyze and record transactions, post transaction to the ledger, prepare a trial balance, prepare
financial statements, journalize closing entries, analyze adjustment data and prepare adjusting entries
B. prepare a trial balance, analyze adjustment data, prepare adjusting entries, prepare financial
statements, journalize closing entries and post to the ledger, analyze and record transactions, post
transactions to the ledger
C. analyze and record transactions, post transactions to the ledger, prepare a trial balance, analyze
adjustment data, prepare adjusting entries, prepare financial statements, journalize closing entries and
post to the ledger, and finally prepare a post-closing trial balance
D. prepare financial statements, journalize closing entries and post to the ledger, analyze and record
transactions, post transactions to the ledger, prepare a trial balance, analyze adjustment data, prepare
adjusting entries
The following are steps in the accounting cycle. Of the following, which would be prepared last?
A. An adjusted trial balance is prepared.
B. Transactions are posted to the ledger.
C. An unadjusted trial balance is prepared.
D. Adjusting entries are journalized and posted to the ledger.

The accounting cycle requires three trial balances be done. In what order should they be prepared?
A. Post-closing, unadjusted, adjusted
B. Unadjusted, post-closing, adjusted
C. Unadjusted, adjusted, post-closing
D. Post-closing, adjusted, unadjusted

The fiscal year selected by companies

A. is the same as the calendar year
B. begins with the first day of the month and ends on the last day of the twelfth month
C. must always begin on January 1
D. will change each year

When a work sheet is complete, the adjustment columns should have

A. total credits greater than total debits if a net income was earned
B. total debits greater than total credits if a net loss was incurred
C. total debits greater than total credits if a net income was earned
D. total debits equal total credits
Which of the following accounts will be closed to the Capital account at the end of the fiscal year?
A. Rent Expense
B. Fees Earned
C. Income Summary
D. Depreciation Expense