Name:

Section:
Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.

1. The work sheet is a:

a. formal statement issued to creditors
b. working paper often used by accountants to summarize adjusting entries
c. replacement for the ledger
d. replacement for a set of financial statements
2. The difference between the totals of the debit and credit columns of the Adjusted Trial Balance columns on a
work sheet:
a. is the amount of net income or loss
b. indicates there is an error on the work sheet
c. is not unusual for preparing the work sheet
d. is the net difference between revenue, expenses, and drawing
3. Net income appears on the work sheet in the:
a. debit column of the Balance Sheet columns
b. debit column of the Adjustments columns
c. debit column of the Income Statement columns
d. credit column of the Income Statement columns
4. A net loss appears on the work sheet in the:
a. debit column of the Balance Sheet columns
b. debit column of the Trial Balance columns
c. debit column of the Income Statement columns
d. credit column of the Adjustments columns
5. A net loss appears on the work sheet:
a. when revenue exceeds expenses
b. when expenses exceed revenues
c. every time the Adjusted Trial Balance columns do not balance on the initial totaling
d. every time the Income Statement columns do not balance on the initial totaling
6. After net income is entered on the work sheet, the Balance Sheet debit and credit columns must:
a. be the same amount as the total amount of the Income Statement debit and credit columns
b. equal each other
c. be the same amount as the total amount in the Adjusted Trial Balance debit and credit
columns
d. not be equal to each other and need not be the same total amounts as any other pair of
columns on the work sheet
7. If the work sheet does not contain a pair of columns for the Retained Earnings Statement, the capital stock and
dividends amounts are:
a. omitted
b. extended to the Balance Sheet columns
c. extended to the Income Statement columns
d. extended to the Adjustments columns
8. Which of the following appears in the Balance Sheet columns of the work sheet?
a. Equipment
b. Fees Earned
c. Depreciation Expense
d. Supplies Expense
9. Which of the following appears in the Balance Sheet columns of the work sheet?
a. Unearned Fees
b. Rent Expense
c. Salaries Expense
d. Service Revenue
10. Which of the following appears in the Balance Sheet columns of the work sheet?
a. Accounts Receivable
b. Rent expense
c. Supplies Expense
d. Service Revenue
11. Which of the following appears in the Balance Sheet columns of the work sheet?
a. Prepaid Insurance

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 b. Wages Expenses
c. Rent Revenue
d. Service Revenue
12. An indication that the work sheet columns are in balance and the work sheet is completed is:
a. the word "Total" is written at the bottom of each pair of columns
b. each pair of columns is double underlined
c. each pair of columns has the totals circled
d. the final figures are written in ink
13. When preparing the Retained Earnings Statement, the beginning capital balance can always be found:
a. in the Income Statement columns of the work sheet
b. in the statement of cash flows
c. in the general ledger
d. in the general journal
14. Unearned Fees appears on the:
a. balance sheet
b. Retained Earnings Statement
c. income statement
d. statement of cash flows
15. Accumulated Depreciation appears on the:
a. balance sheet
b. Retained Earnings Statement
c. income statement
d. statement of cash flows
16. Salaries Payable appears on the:
a. balance sheet
b. Retained Earnings Statement
c. income statement
d. statement of cash flows
17. Depreciation Expense appears on the:
a. balance sheet
b. Retained Earnings Statement
c. income statement
d. statement of cash flows
18. Long-term Liabilities appears on the:
a. balance sheet
b. Retained Earnings Statement
c. income statement
d. statement of cash flows
19 Accounts Receivable appears on the:
a. balance sheet
b. Retained Earnings Statement
c. income statement
d. statement of cash flows
20. Accumulated Depreciation appears on the:
a. balance sheet in the current assets section
b. balance sheet in the fixed assets section
c. balance sheet in the long-term liabilities section
d. income statement as an operating expense
21. Notes Receivable due in 350 days appears on the:
a. balance sheet in the current assets section
b. balance sheet in the fixed assets section
c. balance sheet in the current liabilities section
d. income statement as an expense
22. Unearned Fees appears on the:
a. balance sheet in the current assets section
b. balance sheet as a current liability
c. balance sheet in the Stockholders' equity section
d. income statement as revenue
23. 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
24. The cost of office supplies to be used in future periods is ordinarily shown on the balance sheet as a:
a. fixed asset
b. current asset
c. contra asset
d. current liability
25. Prepaid insurance is reported on the balance sheet as a:
a. current asset
b. fixed asset
c. current liability
d. long-term liability
26. At the end of an accounting year, in what statement would a balance in the prepaid insurance account appear?
a. balance sheet
b. income statement
c. statement of cash flows
d. Retained Earnings Statement
27. Which of the following is reported on the Retained Earnings Statement for the current year?
a. Accumulated depreciation
b. Stockholders' additional investment made during the current period
c. Rent expense
d. Wages payable
28. Adjusting entries are dated in the journal as of:
a. the date they are actually journalized.
b. the last day of the accounting period.
c. the first day of the accounting period.D. the middle of the accounting period.
29. Adjusting entries:
a. need not be journalized since they appear on the work sheet and the ledger accounts need
not be adjusted.
b. need not be posted if the financial statements are prepared from the work sheet
c. are not needed if reversing entries are prepared
d. must be journalized and posted
 30. Closing entries:
a. need not be journalized if reversing entries are prepared
b. need not be posted if the financial statements are prepared from the work sheet
c. are not needed if adjusting entries are prepared
d. must be journalized and posted
. The following accounts were taken from the Adjusted Trial Balance columns of the work sheet:

Accumulated Depreciation P 3,000

Fees Earned 20,000
Depreciation Expense 3,500
Insurance Expense 1,000
Prepaid Rent 4,000
Supplies 500

Net income for the period is:

a. P15,500
b. P 8,000
c. P15,000

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d. P11,000