Deck 6: Work Sheet and Adjusting Entries

Question 1

Only accounts with a balance are listed in the Trial Balance columns of a work sheet.

Answer 1

False

Question 2

Adjusting entries must be posted to the general ledger accounts.

Answer 2

True

Question 3

Many businesses choose a one-year fiscal period that ends during a period of high business activity.

Answer 3

False

Question 4

Two financial statements are prepared from the information on the work sheet.

Question 5

If the Trial Balance columns are not equal and the difference can be evenly divided by 9, then the error most likely is a transposed number.

Question 6

When the Income Statement Debit column total is greater than the Income Statement Credit column total on a work sheet, the business has a net income.

Question 7

Net income on a work sheet is calculated by subtracting the Income Statement Debit column total from the Income Statement Credit column total.

Question 8

If an amount is written in an incorrect column of a work sheet, the error should be erased and the amount should be written in the correct column.

Question 9

The accounting concept Consistent Reporting is being applied when a word processing service business reports revenue per page one year and revenue per hour the next year.

Question 10

The amount of the supplies used during a fiscal period is an expense.

Question 11

Select the one term that best fits each definition.

-Reporting income when it is earned and expenses when they are incurred.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 12

Select the one term that best fits each definition.

-Changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 13

Select the one term that best fits each definition.

-The difference between total revenue and total expenses when total revenue is greater.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 14

Select the one term that best fits each definition.

-The length of time for which a business summarizes financial information and reports its financial performance.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 15

Select the one term that best fits each definition.

-Reporting income when the cash is received and expenses when the cash is paid.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 16

Select the one term that best fits each definition.

-A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 17

Select the one term that best fits each definition.

-Journal entries recorded to update general ledger accounts at the end of a fiscal period.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 18

Select the one term that best fits each definition.

-Cash paid for an expense in one fiscal period that is not used until a later period.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 19

Select the one term that best fits each definition.

-A financial statement showing the revenue and expenses for a fiscal period.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 20

Select the one term that best fits each definition.

-The difference between total revenue and total expenses when total expenses are greater.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 21

Select the one term that best fits each definition.

-A financial statement that reports the value of a business's assets, liabilities, and owner's equity on a specific date.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 22

Select the one term that best fits each definition.

-A proof of the equality of debits and credits in a general ledger.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet

Question 23

Select the one term that best fits each definition.

-A fiscal period consisting of 12 consecutive months.

A) accrual basis of accounting
B) adjusting entries
C) adjustments
D) balance sheet
E) cash basis of accounting
F) fiscal period
G) fiscal year
H) income statement
I) net income
J) net loss
K) prepaid expense
L) trial balance
M) work sheet