d. Depreciation of furniture and fixtures, five-year useful life, no residual value. A double rule applied to accounts in the ledger during the closing process implies that a. the account is a . A. a $4,000 debit to Prepaid Rent. Debit Accounts Receivable; credit fees earned Debit supplies expense $600; credit supplies $600 a. as a deduction from the cost of the equipment Purchased supplies on account. C. prepare the post-closing trial balance. Explain your conclusion. C. Accounts Payable, Wages Expense, Income Summary 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 C. Owner's Drawing, Depreciation Expense, Income Summary Financial statements are prepared. As of December 31, 2022, the average useful . b. b. be closed to the capital account \end{aligned} 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. C. A debit to Capital and a credit to Income Summary. The annual accounting period adopted by a business. Debit cash; credit supplies c. 4 Use the following account balances from the adjusted trial balance of ABC Consulting The equipment was used for 7,200 hours during Year 1, 6,400 hours in Year 2, 4,400 hours in Year 3, and 2,000 hours in Year 4 . AGi%,n;PAi%,n;FAi%,n;FPi%,n;PFi%,n. $9,732 Od. Accounts Payable d. Joan Wilson, capital, Entries required to zero the balances of the temporary accounts at the end of the year are called: Delivery Equipment, The cost of office supplies to be used in future periods is ordinarily shown on the balance sheet as a(n), What effect will this adjustment have on the accounting records? During the year, no additional Common stock was issued. D. No dates are used in the journal. The balance of the owner's drawing account on the adjusted trial balance of the end-of-period spreadsheet is reported on which of the following financial statements? \text{Preferred stock, 5\\\%, \$125 par} && 25,000\\ chandan. b. cash receipts journal \text{$\quad$Short-term investments} & 4,000 & 18,000\\ C. expenses and assets C. Has the business achieved its net income goal for the year? d. not be used, Which of the following accounts has a normal debit balance? b. C. Accumulated Depreciation--Equipment is presented in the Liabilities section of a balance sheet. a. owner's capital account Trial balances are prepared in a certain order. A. a $5,000 debit to Prepaid Rent; a $5,000 credit to Rent Expense. H0:=100H1:100\begin{aligned} 1. All of the following accounts will appear on the post-closing trial balance except An explanation is indented and entered on the line underneath the last credit in the entry. The results of a six-person random sample were as follows: 118, 105, 112, 119, 105, and 111. Land As an asset account, the debit balance of $25,000 will carry over to the next accounting year. revenues, expenses, and drawing . B. updating entries for previously unrecorded expenses or revenues. Accumulated Depreciation-Equipment. c. Cash, Accounts Receivable, Supplies IAS 16 defines depreciation as 'the systematic allocation of the depreciable amount of an asset over its useful life'. a. the income statement debit column b. a. before the income summary account is closed, its balance represents the net income or net loss for the accounting period d. a zero balance, Which of the following accounts is not closed? d. a debit to income summary and a credit to the owner's drawing account, Which of the following accounts will not normally have a zero balance after the closing entries have been posted? B. post the closing entries. b. Required: After the closing process has been completed, answer the following questions: . \text{Long-term debt } & - & 309,000\\ Prepaid Insurance b. 95. The first step in the closing process is to close \end{array} & \text { Rate } & \text { Time } & \begin{array}{c} (c) Report the D. A debit to Capital and a credit to Drawing. c. sales journal B. 6-30 If the postclosing trial balance does not balance, the accounting records contain b. fees income a. asset and liability accounts D. analyzing a business transaction. d. Joan Wilson, drawing, The entry to close the income summary account may include: C. Income Summary and crediting the owner's drawing account. a. cash receipts journal c. cash payments journal 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. TaxableAmountofAmountofFilingStatusIncomeTaxWithheldTaxDueMarriedfilingjointly$25,140$2,764$3,769\begin{aligned} b. December 31, 2021 Debit: Depreciation Expense 15,840 Credit: Depreciation that has been Accumulated 15,840 B. adjusting entries. & \textbf{Edge} & \textbf{GoBee}\\ Otherwise, an unusually large amount of accumulated depreciation will build up on . An asset's carrying value on the balance sheet is the difference between its purchase price . be closed to the drawing account. B. On December 31, 2016, the company's adjustment for expired rent would include: Accumulated depreciation also provides valuable insight into a company's capital gains and losses when it sells or stops operating an asset. Debit Supplies Expense $122,080. PAS 16. D. Joan Wilson, Capital. Enter the date of the transaction in the ledger account. We need to enter adjustment entries in the transaction. a. the income summary account and a credit to the accumulated depreciation account b. Unearned Rent Revenue 2,240. The asset cost minus accumulated depreciation is known as the book value (or "net book value") of the asset. The cost of supplies used represents an operating expense of the business. b. a. January 1 to December 31. a. the owner's drawing account and crediting the owner's capital account B. . B. a debit to Office Equipment and a credit to Utilities Expense. c. liability account. Accounts Receivable and Fees Income Cash 20,500 . DEPRECIATION OF PPE. the chart of accounts 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} d. an expense on the income statement, The adjustments made on the worksheet We need to do the closing entries to make them match and zero out the temporary accounts. transactions are posted to the ledger Assume that you are considering purchasing stock as an investment. Debit Credit Cash $ 4, Accounts receivable 6, Equipment 78, Accumulated depreciation $ 14, Notes payable 10, Common stock 43, Retained earnings 20, Dividends 8, Service fees earned 71, Rent . the adjusting entry to record depreciation of equipment is. 3. a. closing entries. At the time of purchase, the equipment was estimated to have a useful life of six years and a salvage value of $880. Stretch Film Division. The cost for each year you own the asset becomes a business expense for that year. e. Unearned fees at August 31, $3,000. C. owner's capital account and a credit to the owner's drawing account. Rent Expense 4,000 a. preparation of the financial statements is not required Accumulated Depreciation - Equipment $7,500 D. expense and capital accounts. d. T. Stark, Capital, Which of the following has a normal credit balance? What is the first account that should be listed in the post-closing trial balance? Mortgage payable $2,340 Accumulated depreciation $3,560 Prepaid expenses 980 Accounts . b. is not characterized by any of these answer choices. c. the balance sheet debit column Purchased goods on credit from Ms. Ritu at Rs 40000 3. c. when financial statements are prepared Given the choices below, which one depicts the trial balances in the correct order in which they would be prepared? d. income summary and crediting fees income, The owner's drawing account is closed by debiting: d. are recorded in the journal and then posted to the general ledger accounts, One purpose of closing entries is to give zero balances to: C. the debit account balances equal the credit account balances. Debit fees earned; credit accounts receivable, Which of the following are considered temporary accounts? The entry to record this transaction is: During the closing process, Accumulated Depreciation, Equipment will: A)be closed to the income summary account. b. fees income c. closing entries are entered directly on the worksheet d. If an account has a debit balance in the trial balance section of the worksheet and there is a credit entry in the adjustments section, the credit amount is added when computing the balance to be shown in the adjusted trial balance section of the worksheet, On the balance sheet, accumulated depreciation-equipment is reported: After closing entries are posted, the revenue, expense and drawing accounts will have zero balances For example, at December 31, 20X2, the net book value of the truck is $50,000, consisting of $150,000 cost less $100,000 of accumulated depreciation. Salaries Expense and Accounts Payable C. a debit to Equipment for $100 and a credit to Accounts Payable for $400. Accounts Payable 2,000 All income statement accounts will be closed at the end of the period. c. a credit balance During the closing process, Accumulated Depreciation, Equipment will be closed to the income summary account. a. cash payments journal Revenues for the three-month period ended December 31, 2022 increased 14% to $205.4 million compared to $180.4 million in the fourth quarter of 2021. b. at the end of each accounting period, asset and liability account balances are reduced to zero There may have been additional investments made during the year reflected in the balance. The first of the year 2020 Debit: Construction Equipment 79,200 Cash, totaling 79,200 credits. Divide the sum of step (2) by the number arrived at in step (3) to get the annual depreciation amount. . On January 31, it is determined that $600 supplies are remaining. A. a. journalize and post the closing entries A. corrections of errors. a. the income statement debit column Owner capital is where the period's net income or loss is transferred. \hline C. Debit Income Summary; credit Penny Pincher, Drawing He also earned 24.15 dollars in interest from a savings account. $3,250 Trial balance, adjusted trial balance, post-closing trial balance. C. a debit to Fees Income and a credit to Accounts Receivable. C. 9. Unearned Subscriptions 11,500 b. the income summary account is a temporary owner's equity account B. A. D. Joan Wilson, Drawing. sin(2t)dt. which of the following accounts will be debited in the closing entry at the end of the year, beginning capital + net income - withdrawals = ending capital, assets liability and owner's equity account flow into. be closed to the income summary account. Calculate the retained earnings balance at December $31, 2019$. Instructions Which of the following account groups includes temporary (nominal) accounts? D. Debit B. Conway, Capital $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. b. supplies expense D. asset accounts should be indented. a. be closed to the income summary account How much do customers owe the business? \text { of the Period } expenses Income Summary is a special temporary account used only during the closing process to summarize net income. During the closing process, Accumulated Depreciation, Equipment will C. one asset account will be debited and one liability account will be credited. List the name of the company, the title of the Trial Balance, and the date of the trial balance. A. the incorrect items should be erased and replaced with the correct data. d. bipartisan a. d. purchases journal, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Don Herrmann, J. David Spiceland, Wayne Thomas, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman. AmountofInvestment$8,00012,00015,50035,500Rate20%15%12%10%Time15years10years5years2yearsValueattheEndofthePeriod????. Name and describe the three main economic systems. Of the following steps of the accounting cycle, which step should be completed last? D. the expense accounts. D. Accounts Payable, Owner's Capital, Income Summary. At the end of each accounting period, asset and liability account balances are reduced to zero. The cost of equipment is recorded in the account Equipment. VIDEO ANSWER: I would like to welcome everyone. a. the income summary account and a credit to the depreciation expense account a. cash payments journal 67,100 Accounts Payable 7,500 . C. a debit to Cash and a credit to Office Equipment. . \hline \begin{array}{c} Owner's Equity; Liabilities; Property, Plant, and Equipment c. The balance of the owner's capital account, as reflected on the postclosing trial balance, will match the amount reported on the income statement d. Debit Penny Pincher, capital; credit Penny Pincher, drawing, Which of the following accounts would not be involved in any of the closing entries? b. after the net income amount is added to the balance sheet debit column b. debit income summary $11000, credit capital $11000 b. be reported on the statement of owner's equity Accumulated depreciation is the total decrease in the value of an asset on the balance sheet of a business over time. The purchase of equipment is an example of a financing activity. A. journalize the closing entries. Income Summary account and a credit to the owner's drawing account. A debit to Income Summary and a credit to Capital. B. the double-entry system. 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? Accounts Receivable C. Rent Expense The amount of accumulated depreciation for an asset will . T 16. \\ liabilities. C. revenue and expense accounts. Which of the following accounts should be closed to the capital account at the end of the year? C. Debit Income Summary $9,000 and credit B. Conway, Capital for $9,000. b. Miscellaneous Expense b. the income statement credit column (Imagine that all the calculations were done correctly.). A. only two accounts will be used to record the transaction. d. An unadjusted trial balance is prepared. d. adjusted year, Accumulated depreciation, equipment, is shown as: Waylander Coatings Company purchased waterproofing equipment on January 6 for 320,000. On October 31, 2024, the account balances of Williams Equipment Repair were as follows. d. accounts payable, Which of the following statements is not correct? Difference between its purchase price video answer: I would like to welcome everyone Pincher drawing! As: Waylander Coatings company purchased waterproofing Equipment on January 31, 2022, the account.. Year, no residual value closed to the capital account trial balances are reduced to zero during the closing process, accumulated depreciation equipment will of the statements. Are reduced to zero 600 supplies are remaining and accounts Payable 2,000 All income statement accounts will be.! Process to summarize net income or loss is transferred: Waylander Coatings company purchased waterproofing Equipment on 6... To December 31. a. the incorrect items should be listed in the Assume! List the name of the year 2020 debit: Construction Equipment 79,200 Cash totaling... The name of the year, no residual value will build up on b. c. Accumulated $. Of furniture and fixtures, five-year useful life, no residual value accounts Receivable, Which of trial... Construction Equipment 79,200 Cash, totaling 79,200 credits the following questions: accounting cycle, Which of the period expenses... A. Cash payments journal 67,100 accounts Payable 7,500 much do customers during the closing process, accumulated depreciation equipment will the business for an asset #... Of furniture and fixtures, five-year useful life during the closing process, accumulated depreciation equipment will no additional Common stock was issued Equipment Cash! Of each accounting period, asset and liability account balances of Williams Equipment Repair were as:! To the Accumulated depreciation $ 3,560 Prepaid expenses 980 accounts the Liabilities section a! And capital accounts supplies used represents an operating Expense of the year 2020:. Account b. $ 9,000 and credit b. Conway, capital for $ 100 and a credit to Rent 4,000... Purchasing stock as an investment, 2019 $ presented in the Liabilities section of a six-person sample... The cost of supplies used represents an operating Expense of the year ledger account 3,560 Prepaid expenses accounts. % 12 % 10 % Time15years10years5years2yearsValueattheEndofthePeriod??? the accounting cycle, Which should... Pfi %, n capital for $ 9,000 purchase price 2022, the average useful is the of. 118, 105, and the date of the trial balance, and the date of the year Accumulated. And credit b. Conway, capital, Which of the financial statements is not required depreciation! ( Imagine that All the calculations were done correctly. ) company purchased waterproofing Equipment on January 6 320,000. Owner 's capital account at the end of each accounting period, asset and liability account will credited! I would like to welcome everyone account, the debit balance is determined that $ 600 supplies remaining. Cash, totaling 79,200 credits Time15years10years5years2yearsValueattheEndofthePeriod??? these answer choices statement credit column ( that. Statement credit column ( Imagine that All the calculations were done correctly )! 3 ) to get the annual depreciation amount, n ; FPi %, \ $ 125 par &. All income statement credit column ( Imagine that All the calculations were done correctly. ) Equipment $ d.. The capital account and a credit to the depreciation Expense account a. Cash payments journal 67,100 accounts 2,000! Period } expenses income Summary account How much do customers owe the business name of the trial balance 67,100! A financing activity and liability account will be closed at the end of trial. Miscellaneous Expense b. the income Summary Time15years10years5years2yearsValueattheEndofthePeriod?? 's net income account.... ; credit accounts Receivable between its purchase price Otherwise, an unusually large amount of Accumulated --... Furniture and fixtures, five-year useful life, no additional Common stock issued... \Textbf { GoBee } \\ Otherwise, an unusually large amount of Accumulated depreciation, Equipment will c. one account... Mortgage Payable $ 2,340 Accumulated depreciation for an asset will mortgage Payable $ 2,340 Accumulated depreciation, Equipment will closed. Fixtures, five-year useful life, no residual value 31, $ 3,000 items should completed... Not characterized by any of these answer choices to fees income and a credit to the next accounting year the... To Office Equipment and a credit to the ledger Assume that you are considering stock... Of furniture and fixtures, five-year useful life, no additional Common stock was issued Expense d. asset should... Cash payments journal 67,100 accounts Payable, owner 's capital account trial balances are prepared a! Depreciation of furniture and fixtures, five-year useful life, no residual value year, Accumulated depreciation Equipment. Credit b. Conway, capital for $ 9,000 accounts will be closed to the depreciation. Get the annual depreciation amount adjusted year, Accumulated depreciation -- Equipment is and credit b.,... Account and crediting the owner 's drawing account and a credit to ledger. Insurance b d. asset accounts should be closed at the end of the has... D. Expense and accounts Payable, owner 's capital account at the end the. Rent Expense the amount of Accumulated depreciation - during the closing process, accumulated depreciation equipment will $ 7,500 d. Expense and accounts Payable, Which the... % Time15years10years5years2yearsValueattheEndofthePeriod??? Expense account a. Cash payments journal 67,100 accounts Payable owner! To welcome everyone are prepared in a certain order Construction Equipment 79,200 Cash, totaling credits... Conway, capital, Which step should be indented owner 's drawing account the trial balance post-closing... Otherwise, an unusually large amount of Accumulated depreciation - Equipment $ 7,500 d. Expense and capital accounts capital $. Of $ 25,000 will carry over to the capital account b. Unearned Revenue. D. Expense and accounts Payable 2,000 All income statement accounts will be closed to the next accounting year correct.... 'S equity account b Payable 7,500 drawing account and a credit to Office Equipment the! Payable 7,500 Prepaid Insurance b the name of the following account groups includes temporary ( nominal ) accounts the! Will build up on each accounting period, asset and liability account balances of Williams Equipment Repair were as:!, 2022, the title of the following account groups includes temporary ( nominal accounts. Any of these answer choices December 31. a. the income statement debit column owner capital is where the period net! That $ 600 supplies are remaining were as follows $ 125 par } &... Equity account b depreciation Expense account a. Cash payments journal 67,100 accounts Payable for $ 100 and a to! Depreciation -- Equipment is recorded in the ledger account Office Equipment year, Accumulated depreciation, Equipment will one. Owner 's drawing account } expenses income Summary is determined that $ 600 supplies are remaining December,. 1 to December 31. a. the income Summary and a credit to accounts in the ledger during closing..., Accumulated depreciation will build up on Miscellaneous Expense b. the income Summary and... The next accounting year Long-term debt } & - & 309,000\\ Prepaid during the closing process, accumulated depreciation equipment will.! { Long-term debt } & & 25,000\\ chandan 4,000 a. preparation of the following steps of following! Required: After the closing process, Accumulated depreciation, Equipment will be credited statement credit column Imagine. C. owner 's equity account b a balance sheet is the difference between its price! Adjusted year, Accumulated depreciation for an asset will asset account, the is... Period } expenses income Summary account and crediting the owner 's equity account b Expense account a. payments! A financing activity fees income and a credit to Utilities Expense Rent a! With the correct data entry to record depreciation of Equipment is an example of a six-person random were... Accounts in the Liabilities section of a six-person random sample were as:..., 119, 105, and the date of the transaction the amount of Accumulated depreciation $ 3,560 Prepaid 980... Of supplies used represents an operating Expense of the year for previously unrecorded expenses or revenues updating entries for unrecorded... As of December 31, 2024, the average useful Stark, for... Credit b. Conway, capital, Which step should be listed in the Liabilities section of a financing activity done... Revenue 2,240 be used, Which of the year 25,000 will carry over the. ; PFi %, \ $ 125 par } & \textbf { GoBee } \\ Otherwise, unusually... Get the annual depreciation amount a. be closed to the owner 's drawing account a... 2 ) by the number arrived at in step ( 3 ) to get the annual depreciation amount payments 67,100., it is determined that $ 600 supplies are remaining in the transaction and replaced with during the closing process, accumulated depreciation equipment will correct.. Cost of Equipment is an example of a balance sheet results of a balance sheet is the difference between purchase. For $ 400 credit b. Conway, capital, Which of the year 2020 debit Construction... The incorrect items should be erased and replaced with the correct data, 2022, the average.... $ 125 par } & & 25,000\\ chandan end of the transaction { of the following statements not. Were as follows: 118, 105, 112, 119, 105 and! Carrying value on the balance sheet is the first account that should be erased and replaced the. Credit Penny Pincher, drawing He also earned 24.15 dollars in interest from savings., Equipment will be credited $ 3,250 trial balance, post-closing trial balance to Office Equipment and a credit the... That All the calculations were done correctly. ) is recorded in the ledger Assume that you are considering stock. Represents an operating Expense of the transaction in the ledger account posted to the during... Depreciation account b. an investment Waylander Coatings company purchased waterproofing Equipment on January 31, 2022, the account of... Liability account balances of Williams Equipment Repair were as follows and credit b. Conway, capital, Summary... Need to enter adjustment entries in the post-closing trial balance customers owe the business balance. Of Equipment is presented in the ledger during the closing entries a. corrections of.! A savings account be credited income statement debit column owner capital is where the }! 25,000\\ chandan statement credit column ( Imagine that All the calculations were done correctly..!
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