Chapter 8 Review

1.

1 point

The ending account balances of permanent accounts for one fiscal period are the beginning account balances for the next fiscal period.

True

False

2.

1 point

The income summary account has a normal debit balance.

True

False

3.

1 point

Accounts used to accumulate information from one fiscal period to the next are _____ accounts.

expense

permanent

revenue

temporary

4.

1 point

The journal entry to close the expense accounts is...

debit Income Summary for total expenses; credit each expense

debit each expense account; credit Income Summary

debit Income Summary; credit capital

5.

1 point

Journal entries used to prepare temporary accounts for a new fiscal period are called closing entries.

True

False

6.

1 point

The journal entry to close Sales is...

debit Income Summary; credit owner's capital

debit Sales; credit Income Summary

debit Income Summary; credit Sales

7.

1 point

Adjustments are first analyzed and planned on a work sheet before the adjusting entries are journalized.

True

False

8.

1 point

The last step of the accounting cycle is...

to analyze transactions and journalize and post them

to journalize and post the closing entries

to prepare a post-closing trial balance

to prepare a work sheet and financial statements

9.

1 point

Temporary accounts begin each new fiscal period with a ....

debit balance

zero balance

balance equal to net income

credit balance

10.

1 point

The accounts listed on a post-closing trial balance are...

those that have balances after closing entries

all general ledger accounts

those that have no balances after closing entries

11.

1 point

After the closing entries are posted, the only accounts with balances are ______ accounts.

owner's equity

temporary

asset

permanent

12.

1 point

After the closing entries are posted, the owner's capital account balance should be the same as shown...

on the balance sheet (financial statement)

on the worksheet's Balance Sheet Debit column

on the worksheet's Balance Sheet Credit column

on the worksheet's Income Statement Debit column

13.

1 point

The journal entry to close the drawing account is ______.

debit capital; credit drawing

debit Income Summary; credit capital

debit capital; credit Income Summary

debit sales; credit income summary

14.

1 point

The drawing account is a permanent account.

True

False

15.

1 point

Adjusting and Closing entries are recorded on a new General Journal page.

True

False

16.

1 point

Income Summary is...

a temporary account

a liability account

a permanent account

an asset account

17.

1 point

All accounts in a general ledger are listed on a post-closing trial balance.

True

False

18.

1 point

Permanent accounts are also referred to as temporary accounts.

True

False

19.

1 point

Information needed to record closing entries is found in the Income Statement and Balance Sheet columns of the work sheet.

True

False

20.

1 point

A post-closing trial balance verifies the equality of debits and credits in a general ledger after the closing entries are posted.

True

False