a. closing entries If you cannot answer a question, read the related section again. Changes in retained earnings are commonly reported in the: - Statement of cash flows - Balance sheet. 12 Mocha Coffee Shop has asked the accountant to keep track of the purchases for beverage, food, and retail items. The financial statement that reports assets, liabilities, and stockholders' equity is the: (a) income statement. Indicate in which of the following financial statement(s) you would likely find expenses. a.Assets are decreased by credits and have a normal debit balance. Statement of owner's equity C. Income statement D. Balance sheet, Unearned revenue or Deferred Revenue is reported in the financial statements as: a) A revenue on the balance sheet. d.credit balance of $7,500, hich of the following accounts should be closed to the capital account at the end of the year? a. b. in the general ledger a. the Income Statement columns of the end-of-period spreadsheet What item appears on both the balance sheet and. The net income reported on the income statement is $99,849. A consulting firms accounting records display the following costs for year 1: Production was 150,000 billable hours. a.gross profit but not income from operations d. Net income is $9,250. Fundamentals of Financial Management, Concise Edition, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Frank Hodge, Patricia A. Libby, Robert Libby, Charles T. Horngren, Madhav V Rajan, Srikant M. Datar, 7LS - Typical Parts of Cells, 7LS - Cell Memb. a. The cashier scans 800 items. Statement of cash flows B. Income statement b. b.proprietorship The income summary account is also called, After posting the second closing entry to the income summary account, the balance will be equal to, Drawing Account, Fees Earned, Rent Expense. c. after the income statement and the statement of owner's equity. Which of the following accounts will be closed to the capital account at the end of the fiscal year? (d) statement of cash. c.Received cash for services to be performed in the future. What does the productprocess matrix tell us? b.expenses overstated and therefore net income understated Of the following, which step should be done first? Key Takeaways Stockholders' equity is the value of a business's assets that remain after subtracting liabilities. The statement of owner's equity should be prepared after the income statement and before the balance sheet The income statement will present revenues less expenses (ordered largest to smallest amount) with miscellaneous expense listed last The classified balance sheet will show which asset subsections? b.expenses in the period when they are paid a.Cash You'll get a detailed solution from a subject matter expert that helps you learn core concepts. c.revenue ledger c.SEC c) An unearned revenue on the income statement. accounts payable Select the best explanation for the entry. Statement of Cash Flows. 1. d.Interest Revenue, Which side of the account increases the cash account? & \text { Money } & \text { Rate of Nominal } & \text { Price } & \\ Balance Sheet and statement of Owner's Equity-Debit, and income statement-Credi. b.$45,000 Gain in-demand industry knowledge and hands-on practice that will help you stand out from the competition and become a world-class financial analyst. Retained earnings. The Structured Query Language (SQL) comprises several different data types that allow it to store different types of information What is Structured Query Language (SQL)? The journal entry to close revenues would be: debit C. Finley, Capital $3,000, credit C. Finley, Drawing $3,000. Accounting. The classified balance sheet will show which liability subsections? c.product life-cycle management Determine the net income (loss) for the period. In the above-mentioned formula, the equity of the stockholders is the difference between the total assets and the total liabilities. b) A liability on the balance sheet. Variable overhead per billable hour is expected to remain the same, but fi xed overhead is expected to increase by 5 percent. a.Unearned Revenue d.profit reports to owners and management, c.expansion of a product line report to management, A credit balance in which of the following accounts would likely indicate an error? c.not yet been incurred, paid, or recorded The f, Using the following balance sheet and income statement data, what is the current ratio? There are four closing entries. List and discuss the purpose of each financial statement, the order in which the financial statements are prepared, and the information included in each financial statement (information in the back of Chapter 3). There are two closing entries that update the owner's equity account. . b. c. Capital stock. a.total revenue earned for the month of January The Statement of Owner's Equity should be prepared: a. before the income statement and after the balance sheet. Return on equity may also be calculated by . b. the ending balance of owner's equity Which of the following is recorded in the cash receipts journal? 923.190.541. c. $160,000. c. $23,030 b.$36,000 Accounts Payable Cr., Beverage Supplies Dr., Food Supplies Dr. Retail Items Dr., Other Accounts Dr. b. a. a.debit Insurance Expense, $2,100; credit Prepaid Insurance, $2,100 c.debit Cost of Merchandise Sold, $5,000; credit Merchandise Inventory, $5,000 Question: After the trial balance is prepared, the business owner can prepare the financial statements. Total the Debit and Credit columns of the trial balance. The adjusted trial balance includes the postings of the adjustments for the period in the balance of the accounts. a. d. current assets and property, plant, and equipment, d. current assets and property,plant and equipment, The classified balance sheet will show which liability subsections? The balance sheet is also referred to as the statement of financial position or the statement of financial condition. a.Accounts Payable; Unearned Revenue; Collins, Capital Transactions are posted to the ledger. b.purchases journal b. Consultation services showed a decrease in revenue of 25%. c. current liabilities and long-term liabilities, After posting the first closing entry to the owner's capital account, the balance will be increased (decreased) by, c. the net income (net loss) for the period. b. before the income statement and after the statement of owner's equity. a.supply chain management & \text { Nominal } & \text { Growth } & P & \\ 2. September 4, 2020. The adjusting entry at year end on the work sheet would, After all of the account balances have been extended to the Balance Sheet columns of the work sheet, the totals of the debit and credit columns show debits of $36,678 and the credits of $41,101. b.consumer reports to customers a. Classify it as a current asset, a current liability, an expense, a fixed asset, a long-term debt, a revenue, or a stockholders' equity account. b. preparing the closing entries The Adjusted Trial Balance includes the postings of the adjustments for the period in the balance of the accounts, Which of the following accounts will be closed to the Capital account at the end of the fiscal year? Balance sheet c. Statement of stockholders' equity d. Statement of cash flows. d.revenues less expenses (ordered in alphabetical order), a.revenues less expenses (ordered largest to smallest amounts) with miscellaneous expense listed last, If there is a balance in the prepaid rent account after adjusting entries are made, it represents a(n) b.AICPA b. other revenues and property, plant and equipment Owner's Capital925, d. a.cash receipts journal On the same day, another piece of land on the same block sold for $228,830. What item appears on both the balance sheet and the statement of owner's equity? Year1234MNominalMoneySupply(billions)380.95400420441gMGrowthRateofNominalMoneySupply(percent)PPriceLevel(index)Year2=10095.2105.0110.25Inflation(percent). c.balance sheet The statement that represents financial position at a point in time is the: a. balance sheet b. statement of cash flows c. income statement d. statement of owner's equity, Indicate whether the following items would appear on the income statement, balance sheet, or owner's equity statement. capital, Which account will not appear on the post-closing trial balance? The financial statement that reports assets, liabilities, and stockholders' equity is the: (a) income statement. So far, computer systems cannot yet ________. The statement of owner's equity should be prepared, after the income statement and before the balance sheet. a.assets, expenses, liabilities, owner's equity, revenues Divide. a.Corporations are organized as a separate legal taxable entity. For each balance sheet account, identify it as an asset, liability, or owner's equity. Machinery. In which journal would adjusting entries be found? Mar. State whether the normal balance is a debit or a credit. What is the major difference between the unadjusted trial balance and the adjusted trial balance? a. What does this information mean to the accountant? None of these choices, Balance sheet accounts None of these choices are correct. a.Debit Income statement b. On September 1, the company pays rent for twelve months in advance and debits an asset account. Which is the most likely component of aggregate i. Is its normal balance a debit or a credit? d.revenues when services are performed, a.expenses when their future economic value expires or is used up, Which of the following best describes accounting? Financial Modeling & Valuation Analyst (FMVA), Commercial Banking & Credit Analyst (CBCA), Capital Markets & Securities Analyst (CMSA), Certified Business Intelligence & Data Analyst (BIDA), Financial Planning & Wealth Management (FPWM), An equity statement also referred to as a statement of owners equity or statement of changes in equity is a financial statement that a company is required to prepare along with other important financial documents at the end of a reporting period. c. statement of cash flows. . a.determines when revenue is credited to a revenue account d. income statement as an operating expense, b. balance sheet in the property plant and equipment section. after the income statement and the statement of owner's equity. d. eliminates the need to rewrite the financial statements, b. is used to summarize account balances and adjustment for the financial statements, When a corporation adopts a fiscal year that ends when business activities have reached the lowest point in its annual operating cycle, such a fiscal year is called the match the advertised price. Which of the following is not a characteristic of a corporation? c.snow removal services that have been provided but have not been billed or paid An appraisal reported the market value of the land to be $221,555. b. before the income statement and after the statement of owner's equity. Amir Designs purchased a one-year liability insurance policy on March 1st of this year for $5,400 and recorded it as a prepaid expense. \hline 1 & 380.95 & & 95.2 & \\ Is the Sales Revenue account found on the balance sheet or the income statement? Dec. 31Fees Earned750 a. verify that the debits and credits are in balance, Once the adjusting entries are posted, the Adjusted Trial Balance is prepared to, balance sheet in the current assets section, Notes Receivable due in 350 days appear on the. Balance sheet c. Statement of stockholders' equity d. Statement of cash flows, When preparing the Statement of Owner's Equity the beginning balance should be followed by __________ to arrive at the ending balance of the owner's equity. b. expenses, drawings, and owner's equity. a. d. income statement as revenue. c.summarizing b. a debit to capital account and a credit to drawing account, On the balance sheet, owner's equity is c.revenues when the liability is no longer owed D) budgeted statement of cash flows. a. D. recognize that you made a mistake entering $100 when you meant to enter$101. Is used to summarize account balances and adjustments for the financial statements. B) budgeted balance sheet. b.assets Each individual entry in the revenue journal is posted to the a. accounts receivable controlling account b. accounts receivable subsidiary ledger c. revenue controlling account d. accounts receivable subsidiary ledger and the controlling account. a. current liabilities and short-term assets b) Statement of owner's equity, balance sheet, income statement. Balance sheet c. Statement of stockholders' equity d. Statement of cash flows, You can evaluate the economic resources, debt, and overall financial position of a company in which of the following financial statements? d.debit Insurance Expense, $2,100; credit Prepaid Insurance, $2,100, a.debit Insurance Expense, $1,800; credit Prepaid Insurance, $1,800. c. either the Adjusted Trial Balance or the Income Statement columns of the end-of-period spreadsheet (b) retained earnings statement. c.Insurance Expense Statement Of Financial Position. At the end of the month, the total of the amount column of the revenue journal is posted as a a. debit to Accounts Receivable and a credit to Cash b. debit to Accounts Receivable and a credit to Fees Eamed c. debit to Cash and a credit to Fees Earned d. debit to Cash and a credit to Accounts Payable 15. How should the kitchen of a Chinese restaurant be structured? Further, the statement of owner's equity is one of the shorter financial statements because there aren't many transactions that actually affect the equity accounts. A. c. Beverage Supplies Dr., Food Supplies Dr., Retail Items Dr. Other Accounts Dr., Cash Cr. b. c.debit to Cost of Merchandise Sold and a credit to Sales a.government entity Period Of Time. a.design c. are not affected by adjustments c.after the income statement and balance sheet c.decreases assets, increases liabilities d. preparing the adjusted trial balance, The first item appearing on the statement of owner's equity is d. The account Unrealized Loss-Income is reported: A. as a contra account in the stockholders' equity section of the balance sheet. Title of the statement. Unearned Fees Income statement b. When preparing the Statement of Owner's Equity the beginning balance should be followed by ____ to arrive at the ending balance of owner's equity. c.assets are purchased On the companys balance sheet, shareholders equity is represented under the heading Shareholders Equity or Stockholders Equity. The section usually comprises three components: The general format for the statement of owners equity, with the most basic line items, usually looks like the one shown below. Which of the following amounts would be recorded for insurance expense and prepaid insurance during the closing process at the end of Amir's first month of operations on March 31st? The first line contains the name of the company. (a) as income on the income statement (b) as an asset on the balance sheet (c) as a liability on the balance sheet (d) as a part of the retained earnings. d.analysis, Managerial accountants would be responsible for providing information regarding 6. Insurance Expense200 c. Office Equipment c.Received cash for services to be performed in the future. d. revenue. d.$96,014, Randomly listed below are the steps for preparing a trial balance: Which of the following has steps of the accounting cycle in proper sequence (some steps may be missing)? Rent Revenue, Fees Earned, Miscellaneous Expense. First, create the statement heading. withdrawals the Debit column of the balance sheet on the work sheet. Net loss is $790. Which of the following entries records the investment of cash by Taylor Thomas, owner of a proprietorship? b.been earned and not recorded as revenue $115,000. 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Stockholders ' equity is the most likely component of aggregate i the unadjusted balance.