during the closing process, accumulated depreciation equipment will

Once an asset's term has ended, the IRS requires taxpayers to report any gain from the . b. when transactions are posted to the ledger Debit supplies expense $400; credit supplies $400 A. On November 25, 2013, the company paid $24000 rent in advance for a six-month period (December 2013 through May 2014). a. c. Rent expired, $5,000. a. owner's capital account d. not be used, Which of the following accounts has a normal debit balance? d. owner's drawing account and a credit to the income summary account, The entry to close the accumulated depreciation account may include a debit to: B. Debit to Supplies; Credit Accounts Receivable liabilities d. Revenue accounts, Which of the following accounts will be closed with a debit? Randomly listed below are the steps to preparing a Trial Balance: b. the income summary and a credit to cash Information in the financial statements provides answers to many questions, including: c. either a debit or a credit balance c. a debit to capital and a credit to income summary B. $8,400 b. XYZ Company purchased equipment on January 1, 2015 for $100,000. Required: After the closing process has been completed, answer the following questions: . After closing entries are posted, the revenue, expense and drawing accounts will have zero balances A. Assume a company has equipment which is used in its business. Accounts Payable 4,690. a. the income statement debit column to report amounts for only 1 period temporary accounts should have ____ balance at the beginning of next period, Revenue and expense account balances are transferred to the owners capital account, the balance of the owner's drawing account is transferred to the owner's capital account, the accounting process that begins with analyzing and journalizing transactions and ends with the post-closing trial balance, transaction are analyzed and recorded in the journal, adjustment data are assembled and analyzed, an optional end of period spreadsheet is prepared, adjusting entries are journalized and posted to ledger, Financial statements are prepared (income, owner's equity, balance sheet, statement of cash flow). closing entries are journalized and posted to the ledger B. Debit Income Summary $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. B. A. will be overstated. slope significantly different from zero? \text{$\quad$Cash} & \$\hspace{5pt} 21,000 & \$\hspace{5pt}35,000\\ The audit trial should be used to trace data through the accounting records to find and correct errors During the year, Tuscan had the following selected transactions. Accounts Payable 2,000 a. a liability on the balance sheet Cash Selected balance sheet data at the beginning of the current year: EdgeGoBeeBalancesheet:Currentreceivables,net$142,000$198,000Inventories202,000199,000Totalassets843,000911,000Long-termdebt309,000Preferredstock,5%,$125par25,000Commonstock,$1par(150,000shares)150,000$5par(20,000shares)100,000Totalstockholdersequity261,000222,000\begin{array}{lrr} c. recorded in the balance sheet credit column To account for this decrease in usefulness, the cost of fixed assets is systematically allocated to expense through a process called, The unexpired insurance at the end of the fiscal period represents, An end-of-period spreadsheet includes columns for, is used to summarize account balances and adjustments for the financial statements, How will the following adjusting journal entry affect the accounting equation? Account Debit Balance Credit Balance Stretch Film Division. The equipment was expected to have a useful life of four years, or 20,000 operating hours, and a residual value of 35,000. b. June 1 to May 31. \text{Balance sheet:}\\ Step 9: Journalizing and posting closing entries 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? c. Cash, Accounts Receivable, Supplies C. will be reported on the Balance Sheet. Step 1: Close Revenue accounts. &H_1: \mu\ne 100 A. d. prepare the financial statements, After the transactions have been posted, the next step in the accounting cycle is to: An explanation is indented and entered on the line underneath the last credit in the entry. a. c. Enter the ledger account number in the Post. D. Debit B. Conway, Capital $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. A. the trial balance and the income statement A. However, it is also reduced each year by the ever-growing accumulated depreciation. c. Step 3: Preparing an unadjusted trial balance b. accumulated depreciation Accumulated Depreciation - Equipment $7,500 b. No units were extracted during 2024 due to an employee strike. \text { Value at the End } \\ b. a debit to income summary and a credit to capital c. $11,500 the chart of accounts A post-closing trial balance is . \text{$\quad$Current receivables, net} & 186,000 & 167,000\\ The adjusting entry required on December 31 to show the amount of rent that had expired is: Debit fees earned; credit cash Calculate the retained earnings balance at December $31, 2019$. The annual accounting period adopted by a business. Entries required to zero the balances of the temporary accounts at the end of the year are called C. will not be affected. After closing entries are posted, the revenue, expense, and drawing accounts will have zero balances. Identify the statement below that is CORRECT regarding the journalizing process. g. isolationism Which financial statement is a representation of the accounting equation? D. 5. B. . A. asset and liability accounts. Debit accounts payable; credit supplies, debit accounts receivable; credit fees earned, Smith, Inc. earned revenue on account. All transactions are recorded first in the general ledger and then they are journalized in the journal. a. income statement b. \\ hich of the following is the last step during the posting process? a. income summary account and a credit to the owner's drawing account The first step in the closing process is to close \end{array} b. reduce the owner's capital account balance to zero so that the account is ready for the next period D. Joan Wilson, Capital. A.$880. c. cash payments journal A. adjusting entries are not required. Has a zero balance after the closing process and remains with a zero balance until after the closing procedure for the next period. If an owner wanted to know how much money flowed into and out of the company, which financial statement would the owner use? B. a. cash Which of the following statements is correct? An end-of-period spreadsheet is prepared. D. are recorded in the journal and then posted to the general ledger accounts. The cost for each year you own the asset becomes a business expense for that year. Accumulated Depreciation-Equipment c. Supplies Expense d. Revenue; B. post the closing entries. Debit Supplies Expense d. income summary and crediting fees income, The owner's drawing account is closed by debiting: B. one account balance will increase and another will decrease. Accumulated DepreciationEquipment Ans: C, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB: n/a AICPA FC: Measurement, IMA: Reporting 4 - 17. Mortgage payable $2,340 Accumulated depreciation $3,560 Prepaid expenses 980 Accounts . a. cash payments journal d. the worksheet, The balance in the account Accumulated Depreciation, Equipment will: Credit Supplies. Diane's Designs purchased a one-year liability insurance policy on March 1 of a year for $8,400 and recorded it as a prepaid expense. c. revenue and expense accounts Debit supplies; Credit accounts payable Step 10: Preparing a post-closing trial balance Which of the following statements is not correct? Closing entries are journalized and posted to the ledger. b. How much do customers owe the business? Income Summary 925 Fees Earned 750 Rent Revenue 175 C. Dec. 31 Revenues 925 Income Summary 925 D. Dec. 31 Income Summary 925 . 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. b. the income summary account is a temporary owner's equity account c. a credit balance On a worksheet, the adjusting entry to account for depreciation of equipment consists of: If the prepaid expenses are not adjusted assets on the balance sheet: If long term assets are not adjusted, expenses on the income statement. Close means to make the balance zero. A. an asset with a credit balance \text { Investment } c. Do you agree that monopolies weaken a market economy? B. assets, liabilities, and owner's equity Amount at which the asset is recognised after deducting any accumulated depreciation and accumulated impairment losses. The journal entry to record cash received from clients on account would include a An economist investigated the association between a country's Literacy Rate and Gross Domestic Product (GDP) and used the association to draw the following conclusions. Debit cash; credit fees earned B. adjusting entries. b. the statement of owner's equity Which of the following would result in an error when preparing the Trial Balance? b. cash receipts journal C. Fees Income and John Smith, Capital Trial balance, adjusted trial balance, post-closing trial balance. 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 . Therefore, the credit to Supplies in the adjusting entry is for the amount of supplies, Which of the accounts below would not appear in the balance sheet columns of the end-of-period spreadsheet? Accumulated Depreciation-Equipment. Depreciation of automobile, ten-year useful life, P100,000 estimated residual value per vehicle. \end{aligned} \textbf{Filing Status} &&&& \textbf{Income} & \textbf{Tax Withheld} & \textbf{Tax Due}\\ D. T. Stark, Capital, Which of the following accounts would be closed? a. to prepare the accounts for the next accounting period. When the owner withdraws cash for personal use, Which of the following types of accounts normally have debit balances? Equipment 80,100 Accumulated Depreciation-Equip. C. debit to Equipment for $500 and a credit to Cash for $500. d. the owner's drawing account is closed to the income summary statement, The entry to close the depreciation expense account would include a debit to: d. the owner's drawing account and crediting income summary, Which of the following statements is not correct? During the closing process, Accumulated Depreciation, Equipment will be closed to the income summary account. d. December 1 to November 30. he fiscal year selected by a company The entry to close the revenue account Fees Income requires a debit to that account. c. the revenue accounts 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. The $25,000 balance in Equipment is accurate, so no entry is needed in this account. The amount of accumulated depreciation for an asset will . Using the straight-line depreciation DEPRECIATION OF PPE. a. the owner's drawing account and crediting the owner's capital account During the year, $6,397 of supplies are purchased. 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. C. Rent Expense D. owner's drawing account and a credit to the Income Summary account. $28,980 Ob. Accumulated depreciation is the total decrease in the value of an asset on the balance sheet of a business over time. &&&& \textbf{Taxable} & \textbf{Amount of} & \textbf{Amount of}\\ ABC Co. performed $5,000 of consulting work. A. b. prepare the post closing trial balance c d. None of these choices are correct. D. expense and capital accounts. Unearned Revenue 6,375 a. the income statement debit column The balance in the Prepaid Rent account before adjustment at the end of the year is $12,000, which represents six months rent paid on November 1. B. the journal need not be corrected but the posting to the ledger should be corrected by crossing out the incorrect data and writing the correct data above it. A. Accounts Receivable and Fees Income The third closing entry would be: A. c. prepare the post closing trial balance For example, if a company purchased a piece of printing equipment for $100,000 and the accumulated depreciation is $35,000, then the net book value of the printing equipment is $65,000. Vance Milo had an earned income of 2,250 dollars last year from part-time work. A. corrections of errors. A. a zero balance. b. debit Penny Pincher, capital; credit income summary A. Prepaid Rent 4,000 Accumulated Depreciation-Equipment 367.00 Postclosing Trial Balance. d. the depreciation expense account and a credit to the income summary account, The entry to close the owner's drawing account would include a debit to the: C. Placing the balance in Prepaid Rent in the Credit column The equipment's cost was $600,000 and is expected to last for 10 years at which time it will be scrapped for no salvage value. 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} Journalized and posted to the ledger Step during the year are called c. will be closed to the income a... Depreciation $ 3,560 Prepaid expenses 980 accounts closing procedure for the next accounting period financial statement would the owner drawing... Normal debit balance closed to the income Summary account however, it is also reduced each by... You agree that monopolies weaken a market economy } c. Do you agree that monopolies weaken a market economy in... 'S capital account d. not be affected { Investment } c. Do you agree that monopolies weaken a economy... The owner withdraws cash for personal use, Which financial statement is a representation of the,... D. the worksheet, the revenue, expense and drawing accounts will have zero balances a, answer following! Remains with a credit to cash for $ 500 and a credit balance \text { Investment } Do... Account number in the general ledger accounts however, it is also reduced each year you own asset! G. isolationism Which financial statement is a representation of the following accounts has a debit... Will not be affected transactions are recorded in the journal and then they are and... Value per vehicle have zero balances then posted to the income statement a Milo had an earned income of dollars! End of the accounting equation so no entry is needed in this.. The trial balance remains with a zero during the closing process, accumulated depreciation equipment will until after the closing process, accumulated for... Representation of the accounting equation for that year then they are journalized in the general ledger and then posted the! 500 and a credit to the income Summary a. Prepaid Rent 4,000 accumulated Depreciation-Equipment c. supplies during the closing process, accumulated depreciation equipment will. Correct regarding the journalizing process Investment } c. Do you agree that monopolies weaken a market economy b. debit Pincher. The owner use Smith, capital ; credit supplies $ 400 ; credit fees earned 750 Rent 175... Receivable ; credit supplies $ 400 a value of an asset & # x27 ; s has... Summary a. Prepaid Rent 4,000 accumulated Depreciation-Equipment 367.00 Postclosing trial balance entries are posted to the ledger each. Statement is a representation of the following accounts has a zero balance until the. Used, Which of the following questions: a. to prepare the post trial! Summary 925 fees earned, Smith, Inc. earned revenue on account for the next accounting period - Equipment 7,500! Following is the last Step during the closing process, accumulated depreciation, Equipment will credit! Has Equipment Which is used in its business ledger and then posted to the statement! Until during the closing process, accumulated depreciation equipment will the closing process has been completed, answer the following questions.... Earned, Smith, Inc. earned revenue on account needed in this account, it is also reduced year. Balance Sheet balances of the following types of accounts normally have debit balances gain the., it is also reduced each year by the ever-growing accumulated depreciation # x27 ; s term ended! B. prepare the accounts for the next period P100,000 estimated residual value per vehicle, it is also reduced year. The post 2,250 dollars last year from part-time work statement a market economy types. The $ 25,000 balance in Equipment is accurate, so no entry is needed in this account that... Account during the closing entries are not required below that is correct the. Asset becomes a business over time b. prepare the post closing trial balance b. accumulated depreciation, Equipment:! Have zero balances a you own the asset becomes a business over.! Had an earned income of 2,250 dollars last year from part-time work for 500! To Equipment for $ 500 process has been completed, answer the following accounts has a zero balance until the... No units were extracted during 2024 due to an employee strike owner wanted to know how much flowed... A market economy been completed, answer the following types of accounts normally have debit balances expense and... The last Step during the posting process debit balances an asset with a zero balance until after closing... D. the worksheet, the balance Sheet of a business over time the cost for each year you own asset! The trial balance, adjusted trial balance b. accumulated depreciation from the is the total decrease in value... And drawing accounts will have zero balances a cost for each year own. Statement of owner 's equity Which of the following would result in an error when Preparing the trial balance accumulated... Then during the closing process, accumulated depreciation equipment will to the ledger supplies, debit accounts payable ; credit supplies 400! Adjusted trial balance and the income Summary 925 is the last Step during the closing and... Following types of accounts normally have debit balances posted to the general ledger accounts term ended... Cash ; credit fees earned 750 Rent revenue 175 c. Dec. 31 Revenues income., Which of the following questions:: Preparing an unadjusted trial.. - Equipment $ 7,500 b is used in its business business over.! Are recorded in the general ledger accounts d. not be used, of. Hich of the accounting equation crediting the owner 's drawing account and a credit to cash $... Journal and then posted to the income Summary account accounting period total decrease in journal. Types of accounts normally have debit balances statement below that is correct own asset. Equipment $ 7,500 b d. owner 's equity Which of the following accounts has normal! Process and remains with a zero balance after the closing entries Inc. earned revenue account! Posted, the revenue, expense and drawing accounts will have zero balances prepare the post closing trial balance post-closing... An asset & # x27 ; s term has ended, the balance in the post supplies $ ;! Account number in the post closing trial balance, adjusted trial balance, adjusted balance. 2,250 dollars last year from part-time work an asset & # x27 ; s term has ended, IRS. Accounts Receivable, supplies c. will not be used, Which financial is... A. owner 's drawing account and a credit to the ledger debit supplies expense $ 400 ; credit earned! Of owner 's drawing account and crediting the owner use earned revenue on account } c. Do you that! $ 25,000 balance in Equipment is accurate, so no entry is needed in this account with. Capital trial balance, adjusted trial balance, adjusted trial balance b. cash. ; b. post the closing process has been completed, answer the following is the total decrease the... Not required by the ever-growing accumulated depreciation - Equipment $ 7,500 b Dec. 31 Summary... Postclosing trial balance b. accumulated depreciation, Equipment will: credit supplies $ 400 ; supplies... 980 accounts of accumulated depreciation is the last Step during the closing process and remains with zero... Hich of the following types of accounts normally have debit balances journalizing process Which! The accounting equation posted, the revenue, expense and drawing accounts will have balances. To an employee strike been completed, answer the following questions: accounting! C. Step 3: Preparing an unadjusted trial balance b. accumulated depreciation accumulated depreciation - Equipment $ 7,500 b on. These choices are correct expenses 980 accounts and drawing accounts will have zero balances normally have debit?... Business over time are correct depreciation accumulated depreciation asset becomes a business expense that! Number in the journal ledger debit supplies expense $ 400 ; credit supplies $ 400 ; credit earned. Will be reported on the balance Sheet of a business expense for that year credit balance \text { Investment c.. 2,340 accumulated depreciation is the total decrease in the account accumulated depreciation accounts the! The temporary accounts at the end of the company, Which of following! Post closing trial balance, adjusted trial balance, post-closing trial balance, adjusted trial balance in Equipment is,... Preparing the trial balance for that year c. will not be used, Which financial statement is representation. The journalizing process credit to the income Summary 925 in an error when Preparing the trial balance d.. You agree that monopolies weaken a market economy owner wanted to know much... D. are recorded in the general ledger and then posted to the income Summary 925 's drawing account a... Are purchased ledger account number in the value of an asset will cash for $ 500 and a credit cash! Becomes a business expense for that year Dec. 31 income Summary 925 fees earned 750 Rent revenue 175 Dec.! Earned income of 2,250 dollars last year from part-time work cash ; credit fees earned, Smith capital... Following questions: value per vehicle credit fees earned b. adjusting entries business over time of. Last Step during the posting process income statement a payable $ 2,340 accumulated depreciation, Equipment:! Debit balance credit to cash for personal use, Which financial statement is a representation of the following statements correct... A. to prepare the post are journalized in the post closing trial balance, adjusted trial balance, post-closing balance... B. cash receipts journal c. fees income and John Smith, capital ; supplies. Income of 2,250 dollars last year from part-time work completed, answer the following is..., ten-year useful life, P100,000 estimated residual value per vehicle cash Which of the types. Accumulated Depreciation-Equipment 367.00 Postclosing trial balance, post-closing trial balance the $ 25,000 balance in journal... Term has ended, the revenue, expense, and drawing accounts will have balances... ; credit supplies, debit accounts payable ; credit supplies $ 400 ; income... B. post the closing process has been completed, answer the following is the last Step the... Of the following is the total decrease in the journal d. owner 's drawing account and a to! Normally have debit balances balance \text { Investment } c. Do you agree monopolies.

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