Chapter 5 - Results for Multiple Choice Quiz https://tools.mheducation.ca//college/larson10/student/olc/10fal_mc_05.

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Results for Multiple Choice Quiz

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You correctly answered 10 questions for a score of 100 percent.

5-1. Which of the following accounts is not a temporary account?

a. Income Summary
100% b. Rental Revenue
c. Capital
d. Withdrawals

You answered correctly! Capital is a part of owners' equity and is a

real (permanent) account.

5-2. The subtotals of the Income Statement columns of the work sheet are $3,500
and $4,900, respectively. If the subtotal of the Balance Sheet Debit column is
$9,600, then the subtotal of the Balance Sheet Credit column should be

a. $1,400
b. $11,000
c. $8,200
d. $6,800

You answered correctly! The net income was $1,400 (the Credit
column of the work sheet Income Statement less its Debit column). The
subtotal of the Balance Sheet Credit column will be $8,200 ($9,600 -
$1,400).

5-3. The subtotals of the Income Statement columns of the work sheet are $6,200
and $4,900, respectively. If the subtotal of the Balance Sheet Debit column is
$19,000, then the subtotal of the Balance Sheet Credit column should be

a. $20,300
b. $1,300
c. $17,700
d. $14,400

You answered correctly! The net loss was $1,300 (the Credit column
of the work sheet Income Statement less its Debit column). The subtotal
of the Balance Sheet Credit column will be $20,300 ($19,000 + $1,300).

5-4. Revenue and expense accounts at the beginning and end of the accounting
period should have

a. a balance of zero
b. balances of cumulative amounts of activity during the period
c. a net balance (credits minus debits) equal to the capital account
d. a net balance equal to assets minus liabilities

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Chapter 5 - Results for Multiple Choice Quiz https://tools.mheducation.ca//college/larson10/student/olc/10fal_mc_05.html

You answered correctly! The accounts start with zero and are closed
to end with a zero balance, so they are ready for summarizing the
business activities of the following accounting period.

5-5. Which is true about an adjusting entry?

a. only a permanent account is adjusted

b. only a temporary account is adjusted
c. a permanent account and a temporary account is adjusted
d. it is required to satisfy the realization principle only

You answered correctly! Each adjusting entry affects a temporary

account and a permanent account (a review of adjusting entries will
support this statement) and they are required when adhering to the
realization and matching principles.

5-6. After the closing procedure is complete, which of the documents proves the
equality of debits and credits?

a. Income Statement
b. Account form balance sheet
c. Post-Closing Trial Balance
d. Work Sheet

You answered correctly! The post-closing trial balance is specifically

designed and prepared to prove the equality of debits and credits, and
partially test the clerical accuracy of the adjusting and closing
procedures.

5-7. At the end of the fiscal year, an adjusting entry was made for accrued salaries
of $500. On the first day of the new year the adjusting entry was reversed. The
salaries for one week, $1,250, were paid on the first Friday. The entry to record
paying the salaries expense for the week would be a

a. Sal. Exp., dr., $750; Salaries Payable, dr., $500; Cash, cr., $1,250
b. Sal. Exp., dr., $500; Salaries Payable, dr., $750; Cash, cr., $1,250
c. Salaries Exp., dr., $1,250; Cash, cr., $1,250
d. Salaries Exp., dr., $1,250; Salaries Payable, cr., $1,250

You answered correctly! A reversing entry eliminated the need to

debit the accrued salaries account on the date of payment. The
reversing entry eliminated the balance of the Salaries Payable account
and placed the liability in the expense account.

5-8. Optional entries that transfer the balances in balance sheet accounts which
arose as a result of certain adjusting entries to income statement accounts is the
definition for which term below?

a. adjusting entries
b. reversing entries
c. closing entries

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Chapter 5 - Results for Multiple Choice Quiz https://tools.mheducation.ca//college/larson10/student/olc/10fal_mc_05.html

d. declarations of cash dividends

You answered correctly! Reversing entries are optional and facilitate

maintaining the normal bookkeeping routines of the business.

5-9. The last account listed on the post-closing trial balance for a corporation is the

a. Capital account
b. Withdrawals account
c. Retained Earnings account
d. Common Stock account

You answered correctly! Only real accounts are listed on the post-
closing trial balance. The last account listed for a corporation is the
Retained Earnings account. Capital and withdrawals are single
proprietorship accounts.

5-10. The last account listed on the post-closing trial balance for a single
proprietorship business is the

a. Capital account
b. Withdrawals account
c. Retained Earnings account
d. Common Stock account

You answered correctly! Only real accounts are listed on the post-
closing trial balance. The last account listed for a single proprietorship
business is the Capital account. The last account listed for a corporation
is the Retained Earnings account.

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Chapter 5 - Results for Multiple Choice Quiz https://tools.mheducation.ca//college/larson10/student/olc/10fal_mc_05.html

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