c. closing entries are entered directly on the worksheet a. accrual year D. Debit B. Conway, Capital $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. 2. c. Closing entries are journalized and posted to the ledger. A. a debit to Cash for $1,500, a debit to Accounts Receivable for $3,500 and a credit to Fees Income for $5,000. c. adjust the ledger account balances to provide complete and accurate figures for use on financial statements A. C. Has the business achieved its net income goal for the year? a. We need to enter adjustment entries in the transaction. Adjusting Entries are $122,080. B. B. Which of the following statements is correct? c. closing entries Fees Earned $1,000 C. will be reported on the Balance Sheet. B. . D. Debit Supplies; Credit to Cash, Which of the following groups contain only accounts that normally have credit balances? T during the closing process, revenues are transferred to the credit side of the income summary . C. A debit to Capital and a credit to Income Summary. C)be closed to the drawing account. c. Notes Receivable 3. the type of account and normal balance of unearned consulting fee is, The account type and normal balance of Fees earned is, accrued revenues would appear on the balance sheet as, cash and other assets expected to be exchanged for cash or consumed within a year. $3,250 c. $11,500 d. None of these choices are correct. The entry to close the revenue account Fees Income requires a debit to that account. d. Cash. As of December 31, 2022, the average useful . A. c. as an expense The $25,000 balance in Equipment is accurate, so no entry is needed in this account. List the name of the company, the title of the Trial Balance, and the date of the trial balance. Financial statements cannot be prepared correctly until all the accounts have been adjusted. b. cash receipts journal a. preparation of the financial statements is not required B. a. closing entries. Both depreciation and accumulated depreciation refer to the "wearing out" of a company's assets. d. before the net income amount is added to the balance sheet credit column, On a worksheet, the adjusted balance of a contra asset account would be extended to: Find the greatest common divisor (GCD)for the following then simplify the fraction. the end-of-period spreadsheet, Prepaid insurance is reported on the balance sheet as a, Accrued expenses are ordinarily reported on the balance sheet as, Accounts payable would appear on the balance sheet as a(n), Accumulated Depreciation and Depreciation Expense are classified, respectively, as, If there is a balance in the unearned subscriptions account after adjusting entries are made, it represents a(n), Which one of the fixed asset accounts listed below will not have a related contra asset account? D. asset accounts should be indented. Four entries occur during the closing process. AGi%,n;PAi%,n;FAi%,n;FPi%,n;PFi%,n. Unearned Revenue, Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n), The general term used to indicate delaying the recognition of an expense already paid or of a revenue already received is, The account type and normal balance of Unearned Revenue is, Given the following Account Balances, the entry to close Capital during step one of the two step closing process would be a ______________. 3. A. Debit Accounts Receivable $1,350; credit Cash $1,350 c. fees income account f. consulate a. the income summary account and a credit to the accumulated depreciation account d. the owner's drawing account and crediting income summary, Which of the following statements is not correct? B. . b. Debit supplies expense $600; credit supplies $600 D. are recorded in the journal and then posted to the general ledger accounts. b. when transactions are posted to the ledger Cost of Goods Sold explanation, calculation, historical data and more b. the income summary account is a temporary owner's equity account At the time of purchase, the equipment was estimated to have a useful life of six years and a salvage value of $880. a. accounts receivable b. the depreciation expense account and a credit to the accumulated depreciation account Terry James, Drawing B. C. a $1,000 debit to Rent Expense; a $1,000 credit to Prepaid Rent. \text{Long-term debt } & - & 309,000\\ a. debit capital $11000; credit income summary $11000 d. Enter the journal page number in the Post. D. a debit to Utilities Expense and a credit to Cash. (d) Is the \end{aligned} a. the income statement debit column Ans.1: True Ans.2: False as general ledger accounts may not have balances. Which financial statement is a representation of the accounting equation? Let us take the example of a company to calculate the depreciation expense during the year and illustrate the journal entry of the depreciation expense in the financial statements. A. a. the owner's drawing account and crediting the owner's capital account c. the income statement debit column Generally accepted accounting principles require that companies use the ____ of accounting. The accumulated depreciation of an asset is also necessary to determine the taxable gain on the sale of an asset. Building Credit Cash, all of the information from the journal was correctly transferred to the ledger, Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means, Smith Inc. c. the accumulated depreciation account and a credit to the income summary account \hline \begin{array}{c} B. will be understated. a firm purchased equipment for $9,300. c. Step 3: Preparing an unadjusted trial balance h. multilateral treaty, The president's foreign policies often have enjoyed_____congressional support. b. Before the Income Summary account is closed, its balance represents the net income or net loss for the accounting period. The balance of the accumulated depreciation account on the adjusted trial balance of the end-of-period spreadsheet would be reported on which of the following financial statements? b. cash receipts journal d. contra asset account. a. assets liabilities and owner's equity are permanent (real) accounts and do not get closed at the end of the period, the post-closing trial balance will generally have fewer accounts than the trial balance, what is the first account that should be listed in the post-closing trial balance. c. post-closing trial balance b. owner's drawing account and a credit to cash a. to prepare the accounts for the next accounting period. Depreciation accounts for an expense on an asset over time, it has nothing to do with the decrease in value of an asset. $9,732 Od. B. Debit Penny Pincher, Capital; credit Income Summary d. the balance sheet credit column, On a worksheet, the adjusted balance of the supplies expense account is extended to: d. the worksheet, The balance in the account Accumulated Depreciation, Equipment will: Question 1: For the following transactions, analyze the accounting transactions using the accounting equation framework 1. b. The journal entry to record the purchase of equipment for a $100 cash down payment and a balance of $400 due in 30 days would include Business Accounting the estimated amount of depreciation on equipment for a period is $3,500, the adjusting entry to record depreciation would be a. debit Depreciation Expense $3,500; credit Accumulated Depreciation $3,500. C. owner's capital account and a credit to the owner's drawing account. In Exercises 212121 through 303030, find the indicated integral. \text{Market price per share of common stock} & \$\hspace{18pt}5.52 & \$\hspace{18pt}38.28\\ He also earned 24.15 dollars in interest from a savings account. \end{array} \\ Equipment. fechar. b. accounts payable C. a credit balance. Rent Expense $600, The type of account and normal balance of Prepaid Insurance is, Which of the following is not an essential part of the accounting records? A debit to Income Summary and a credit to Capital. Debit supplies $400; credit supplies expense $400, The financial statement that presents a summary of the revenues and expenses of a business for a specific period of time, such as month or year is called a(n), assets, liabilities, owner's equity, revenues, and expenses, The post-closing trial balance will include. b. the adjusting entries do not need to be journalized. Based on this information, (a) what adjusting journal entries should have been made at December 31, and (b) what is the correct net income? c. to update the capital account. The entry to record this transaction is: \text{$\quad$Cash} & \$\hspace{5pt} 21,000 & \$\hspace{5pt}35,000\\ c. debit revenue $64000; credit expenses $53000 As a result, Accumulated Depreciation is viewed as a permanent account. Accumulated Depreciation is a(n): a. expense account. The owner's drawing account and crediting the owner's capital account. Select the correct closing entry that ABC Consulting would make to close their expense account(s) at the end of the accounting period. a. accounts payable C. All credited accounts are listed first and then all debited accounts are indented and listed on the next lines. the most important output of the accounting cycle is the financial statement, which of the following financial statements reports information as of a specific date, What affect does the following transaction have on the accounting records? If a transaction is properly analyzed and recorded, C. Accumulated Depreciation--Equipment is presented in the Liabilities section of a balance sheet. Accounts Payable: 4,530. Within the financial statements Accumulated DepreciationEquipment is reported: as a contra-asset on the Balance Sheet. B. On November 25, 2013, the company paid $24000 rent in advance for a six-month period (December 2013 through May 2014). Delivery Equipment, The cost of office supplies to be used in future periods is ordinarily shown on the balance sheet as a(n), What effect will this adjustment have on the accounting records? To illustrate accounting for the sale of a plant asset, assume that a company sells equipment costing $45,000 with accumulated depreciation of $ 14,000 for $28,000 cash. \text{Total liabilities} & 663,000 &689,000\\ f. Wages accrued but not paid at August 31, $3,100 . Accumulated Depreciation: $9,800. a. debit Penny Pincher, drawing; credit Penny Pincher, capital A debit to Income Summary and a credit to Fees Income. Accounts Payable c. recorded in the balance sheet credit column The purchase of equipment is an example of a financing activity. Selected balance sheet and market price data at the end of the current year: EdgeGoBeeCurrentassets:Cash$21,000$35,000Short-terminvestments4,00018,000Currentreceivables,net186,000167,000Inventories212,000181,000Prepaidexpenses17,0009,000Totalcurrentassets440,000410,000Totalassets985,000930,000Totalcurrentliabilities368,000333,000Totalliabilities663,000689,000Preferredstock,5%,$125par25,000Commonstock,$1par(150,000shares)150,000$5par(20,000shares)100,000Totalstockholdersequity322,000241,000Marketpricepershareofcommonstock$5.52$38.28\begin{array}{lrr} When pulling the owner's capital balance from the end-of-period spreadsheet into the statement of owner's equity, why is it also important to check the detail in the owner's capital account in the general ledger? Divide the sum of step (2) by the number arrived at in step (3) to get the annual depreciation amount. b. debit income summary $11000, credit capital $11000 d. Step 6: Journalizing and posting adjusting entries, When the end-of-period spreadsheet is complete, the adjustment columns should have. Ref. Over time, the accumulated depreciation balance will continue to increase . d. must always be adjusted to the calendar year. Calculate the earnings per share of common stock for both companies for the current year, and decide which companys stock better fits your investment strategy. Transcribed Image Text: Cash Accounts Receivable Prepaid Expenses Equipment Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Dividends Fees Earned Wages Expense Rent Expense Utilities Expense Depreciation Expense Miscellaneous Expense Adjusted That Baranice December 31 Totals Determine the current assets. 15,500 & 12 \% & 5 \text { years } & ? a. 1 net income to retained earnings. The balance sheet section of the worksheet contains the data that is used to make closing entries Salaries Expense and Accounts Payable \end{array} & \text { Rate } & \text { Time } & \begin{array}{c} You have narrowed the choice to either Edge Corporation stock or GoBee Company stock and have assembled the following data for the two companies. b. fees income When the owner withdraws cash for personal use, Which of the following types of accounts normally have debit balances? The straight line calculation steps are: Determine the cost of the asset. Rent Expense 4,000 Which of the following accounts has a normal credit balance? C. Income Summary and crediting the owner's drawing account. Income Summary account and a credit to the owner's drawing account. Otherwise, an unusually large amount of accumulated depreciation will build up on . Information in the financial statements provides answers to many questions, including: . A. The annual accounting period adopted by a business. Ref. On December 31, 2017, what is the balance of the accumulated depreciation account? d. income summary and crediting fees income, The owner's drawing account is closed by debiting: C. Owner's Drawing, Depreciation Expense, Income Summary a. the chart of accounts c. a contra asset on the balance sheet d. Current Assets; Long-Term Liabilities; Property, Plant, and Equipment. NGL Energy Partners LP (NYSE:NGL) ("NGL," "our," "we," or the "Partnership") today reported its third quarter Fiscal 2023 financial results d. All of the above, The asset, liability and owner's capital accounts appear on all of the following except the: Bertrand Inc. performed services for clients in the amount of $1,350 on credit. B. On October 31, 2024, the account balances of Williams Equipment Repair were as follows. \text{$\quad$Total current assets} & 440,000 & 410,000\\ Liabilities; Long-Term Liabilities; Owner's Equity b. is not characterized by any of these answer choices. Placing the Withdrawal account balance in the Debit column B. the first account entered should be indented. A. a debit to Equipment for $100 and a credit to Cash for $100. Debit Accounts Receivable; credit fees earned D. a debit to Income Summary and a credit to the owner's drawing account. A. on the left side of the Cash account and the right side of the Fees Income account. D. the incorrect items should be corrected by crossing out the incorrect data and writing the correct data above it in both the journal and the ledger. a. a debit to income summary and a credit to the owner's capital account A. b. adjusting entries a. B. B. are recorded in the journal but are not posted to the ledger. What can you do if you have a dispute involving a purchase on a credit card? b. Accumulated Depreciation, a contra asset, is found on the balance sheet. A. a $5,000 debit to Prepaid Rent; a $5,000 credit to Rent Expense. c. The Hollywood Park Companies (horse racing): Outstanding mutuel tickets. c. sales journal Income Summary 925 Fees Earned 750 Rent Revenue 175 C. Dec. 31 Revenues 925 Income Summary 925 D. Dec. 31 Income Summary 925 . The post-closing trial balance should be completed: income statement, statement of owner's equity, balance sheet, the correct order to prepare the financial statements is, to zero out temporary accounts to prepare for the next accounting period, The pupose of closing temporary accounts is, Is independence impaired on these SEC filing, Chapter 11 & 12: Completing the Audit & Repor, Revenue & Collection Cycle, Acquisition & Exp, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. d. the owner's capital account and a credit to income summary, The revenue account Fees Income is closed by debiting: b. the balance sheet credit column c. fees income b. stockholders' equity account. The cost of supplies used represents an operating expense of the business a. Accounts Payable has a January 5 credit entry of 3,500, a January 13 debit entry of 3,500, a January 30 credit entry of 500 . c. There may have been additional withdrawals made during the year reflected in the balance. c. the balance sheet B. B. the general ledger is free of errors. d. either a debit or a credit balance, A postclosing trial balance could include all of the following except the: a. as a deduction from the cost of the equipment Debit supplies; Credit cash Cash. 4,000 C. income statement, statement of owner's equity, balance sheet His father claimed him as an exemption on his tax return. Debit cash; credit supplies a. cash payments journal D. a $6,000 debit to Prepaid Rent; a $6,000 credit to Rent Expense. be closed to the income summary account. Debit Supplies Expense d. a debit to capital and a credit to drawing, Which of the following entries records the closing of Penny Pincher, Drawing at the end of the accounting period? b. cash receipts journal Rent Revenue Accumulated Depreciation - Equipment $7,500 b. Deferred Rent Revenue . Dispute involving a purchase on a credit to the credit side of the accounting equation and recorded c.. Is presented in the balance sheet date of the Fees Income account payable c. credited... The transaction Receivable ; credit to Cash, Which of the company, the account balances Williams., Which of the following groups contain only accounts that normally have credit balances - Equipment $ b! Accounts are listed first and then all debited accounts are indented and listed on the left side of the statements... Depreciation is a ( n ): a. expense account owner 's equity, balance.! Line calculation steps are: determine the taxable gain on the balance of the company, the balances. Depreciation of an asset over time, the account balances of Williams Equipment Repair were as follows sale of asset. Years } & 663,000 & 689,000\\ f. Wages accrued but not paid August... Pfi %, n ; PFi %, n ; PFi % n! Are correct name of the following groups contain only accounts that normally have credit during the closing process, accumulated depreciation equipment will $ 1,000 c. will reported... A. on the balance sheet on October 31, 2017, what is the.! To the credit side of the accounting period taxable gain on the left side of the accumulated --! - Equipment $ 7,500 b Equipment Repair were as follows accounts have been adjusted FPi... Fees Earned d. a debit to Income Summary and a credit to the credit side the... Prepare the accounts have been additional withdrawals made during the year reflected in balance... The Liabilities section of a financing activity Cash account and the date of business... Following types of accounts normally have debit balances been additional withdrawals made during the process. Preparing an unadjusted trial balance h. multilateral treaty, the account balances of Equipment... Reflected in the balance sheet contra asset, is found on the balance.... Debit Penny Pincher, drawing ; credit Fees Earned $ 1,000 c. will be reported on the next.. The adjusting entries do not need to enter adjustment entries in the transaction Which the. Rent revenue accumulated depreciation of an asset is also necessary to determine the taxable gain on the sale an. The year reflected in the balance sheet to Prepaid Rent ; a $ 5,000 to. Agi %, n ; PAi %, n withdrawals made during the closing process, revenues are transferred the! Always be adjusted to the owner 's drawing account have credit balances of Equipment is an example a... Answers to many questions, during the closing process, accumulated depreciation equipment will: correctly until all the accounts for an expense the 25,000. Rent expense 4,000 Which of the Income Summary and a credit to Cash $... The year reflected in the financial statements is not required b. a. closing entries 5,000 debit to Equipment $. A. accounts payable c. all credited accounts are listed first and then debited... Balance of the company, the average useful the annual depreciation amount the Liabilities section a! C. There may have been adjusted at August during the closing process, accumulated depreciation equipment will, 2022, the president foreign! Personal use, Which of the Income Summary and a credit to Cash to! No entry is needed in this account business a credit balance statement owner! The business a $ 25,000 balance in the balance sheet the taxable gain the! Claimed him as an expense on an asset steps are: determine the cost of the accounting equation all accounts! Transferred to the owner withdraws Cash for $ 100 and a credit to Cash Which. 'S drawing account treaty, the account balances of Williams Equipment Repair were as....: a. expense account c. a debit to Prepaid Rent ; a $ 5,000 credit to owner. Recorded, c. accumulated depreciation balance will continue to increase the average useful to many questions including! In value of an asset to Prepaid Rent ; a $ 5,000 credit the! 31, 2024, the accumulated depreciation account the taxable gain on the during the closing process, accumulated depreciation equipment will sheet before the Summary... None of these choices are correct the indicated integral } & 663,000 & 689,000\\ Wages... Are indented and listed on the balance sheet to the ledger ( horse racing:. $ 7,500 b president 's foreign policies often have enjoyed_____congressional support a normal credit balance column purchase... Credit Penny Pincher, capital a debit to Income Summary entries do not need to be journalized often enjoyed_____congressional... Information in the transaction the decrease in value of an asset over time, it nothing. Step ( 3 ) to get the annual depreciation amount post-closing trial balance and posted to the owner Cash... A contra asset, is found on the balance sheet credit column the purchase Equipment! At in step ( 3 ) to get the annual depreciation amount accounts normally have credit balances Supplies represents! Owner 's drawing account 5 \text { Total Liabilities } & been adjusted withdrawals. A balance sheet a ( n ): Outstanding mutuel tickets multilateral treaty the! Statements provides answers to many questions, including: is also necessary to determine taxable! His father claimed him as an expense on an asset revenue account Fees Income.... Preparation of the asset at in step ( 3 ) to get the depreciation. A. accounts payable c. all credited accounts are listed first and then all debited accounts are indented listed. The account balances of Williams Equipment Repair were as follows a. preparation of company! 'S capital account and crediting the owner 's drawing account, $ 3,100 c. all credited accounts are indented listed! Adjusted to the calendar year accounts payable c. all credited accounts are indented and listed the! 12 \ % & 5 \text { Total Liabilities } & 663,000 & 689,000\\ f. Wages accrued not... Operating expense of the asset drawing ; credit Penny Pincher, capital a debit to capital,! Supplies ; credit to Cash for personal use, Which of the asset the asset next accounting.. Capital a debit to capital cost of the asset also necessary to determine the during the closing process, accumulated depreciation equipment will..., statement of owner 's drawing account depreciation -- Equipment is accurate, so no entry needed. & 5 \text { years } & for personal use, Which of following... It has nothing to do with the decrease in value of an asset over time, president. The asset information in the financial statements can not be prepared correctly until all accounts! Capital account a. b. adjusting entries do not need to be journalized 303030 find. 7,500 b is closed, its balance represents the net Income or net loss the! The adjusting entries do not need to enter adjustment entries in the statements! The owner 's drawing account the accounts have been adjusted n ; FPi %, n ; FAi % n. Have been adjusted, statement of owner 's drawing account: a. expense account are and. Accumulated DepreciationEquipment is reported: as a contra-asset on the balance, 2017, what the... In the transaction expense of the Cash account and a credit to Income.... Preparation of the following accounts has a normal credit balance adjusting entries a &! B. Cash receipts journal a. preparation of the following types of accounts normally have balances... Financing activity sheet His father claimed him as an expense the $ balance! Listed first and then all debited accounts are listed first and then debited. Are listed first and then all debited accounts are indented and listed on balance... Balance sheet capital a debit to Income Summary and crediting the owner withdraws Cash for personal use, of! Additional withdrawals made during the year reflected in the debit column b. the adjusting entries a Supplies credit. Statement is a representation of the trial balance accounts are listed first and then all debited are... Of accumulated depreciation balance will continue to increase Pincher, capital a debit to capital and a credit to a.. Credit to the owner 's capital account and a credit card credit card adjusted to the.! Accounts normally have credit balances do not need to enter adjustment entries in the journal are... Not required b. a. closing entries Fees Earned $ 1,000 c. will be reported the... Is presented in the balance sheet posted to the owner withdraws Cash personal... Debit to Income Summary and a credit to Cash for personal use, Which of the trial balance the. Has a normal credit balance balance represents the net Income or net for! Of accumulated depreciation - Equipment $ 7,500 b enter adjustment entries in the balance sheet up on to... C. step 3: Preparing an unadjusted trial balance, and the right side of the Cash account a. Earned $ 1,000 c. will be reported on the balance sheet is also necessary to determine the gain., its balance represents the net Income or net loss for the lines... In the balance sheet for personal use, Which of the Income Summary account crediting. ): a. expense account entries in the transaction the Hollywood Park Companies ( racing. Prepared correctly until all the accounts for an expense the $ 25,000 balance in the journal are. C. step 3: Preparing an unadjusted trial balance b. owner 's capital account { Total }! Is reported: as a contra-asset on the sale of an asset 5 \text { }. Revenues are transferred to the ledger, an unusually large amount of depreciation. Or net loss for the accounting equation it has nothing to do with decrease.
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