Question 1

Net loss appears on the worksheet:

Accepted Answer

Net loss is a debit balance in the income statement and a credit balance in the balance sheet.

Question 2

All of the following are listed on a worksheet except:

Accepted Answer

A worksheet typically includes debit and credit columns for an income statement, a balance sheet, and adjustments, but not for a statement of owner's equity. The statement of owner's equity is derived from the information in these columns rather than having its own separate columns on the worksheet.

Question 3

The worksheet is used only for accounts that are adjusted.

Accepted Answer

Worksheets can be used for a variety of purposes, including planning adjustments, but they are not limited to accounts that are adjusted. They can also be used for organizing financial information, preparing financial statements, and analyzing data.

Question 4

If the unearned service revenue account had an unadjusted normal balance of $4,800, and an adjustment was made debiting the account for $1,500, the account would appear on the adjusted trial balance of the worksheet as a:

Accepted Answer

Unearned service revenue is a liability account with a normal credit balance. If it had an unadjusted balance of $4,800 (credit) and was debited for $1,500, the new balance would be $4,800 - $1,500 = $3,300 credit.

Question 5

The unadjusted trial balance columns of a worksheet contain the account balances that appear on the financial statements.

Accepted Answer

The unadjusted trial balance columns of a worksheet contain the initial balances of all accounts before any year-end adjustments are made. The adjustments are then made in the adjustments columns, and the adjusted balances are what appear on the financial statements.

Question 6

The worksheet is the financial statement that must be prepared before all of the others.

Accepted Answer

The worksheet is an internal document used for planning and adjusting entries; it is not a formal financial statement and does not need to be prepared before other financial statements.

Question 7

On a worksheet, the income statement debit column equals $190,800 and the income statement credit column equals $195,600. From this data, it can be determined that:

Accepted Answer

The answer of On a worksheet, the income statement debit...

Question 8

On the worksheet, the difference between the balance sheet debit column and the balance sheet credit column represents the net income or net loss.

Accepted Answer

The difference between the balance sheet debit column and the balance sheet credit column represents the net income or net loss because the balance sheet must always balance. If the debit column is greater than the credit column, then the business has a net income. If the credit column is greater than the debit column, then the business has a net loss.

Question 9

Salary expense has a balance of $65,400 in the trial balance debit column of a worksheet. The adjustments credit column contains a $500 credit to salary payable. The adjusted trial balance column will show:

Accepted Answer

The answer of Salary expense has a balance of $65,400...

Question 10

Net income appears on the worksheet:

Accepted Answer

Net income is recorded as a debit in the income statement to close out revenue and as a credit in the balance sheet to increase retained earnings.

Question 11

Interest expense on a worksheet's trial balance debit column has a $3,400 balance and a $4,000 balance on the worksheet's income statement debit column. The difference is due to:

Accepted Answer

The answer of Interest expense on a worksheet's trial balance...

Question 12

On a worksheet, the sum of the income statement debit column exceeds the sum of the income statement credit column. This indicates the company generated a net loss during the current period.

Accepted Answer

When the sum of the income statement debit column exceeds the sum of the income statement credit column on a worksheet, it indicates that the company's expenses (debits) are greater than its revenues (credits), resulting in a net loss.

Question 13

A worksheet is a:

Accepted Answer

Worksheets are multicolumn documents used by accountants to organize, adjust, and correct data before preparing the official financial statements. They are not typically formal documents required by external entities but are tools for internal use.

Question 14

After all the account balances have been extended to the balance sheet columns of the worksheet, the totals of the debit and credit columns are $35,350 and $38,750, respectively. It can be concluded the company has a:

Accepted Answer

When the credit column total ($38,750) exceeds the debit column total ($35,350) in the balance sheet columns of a worksheet, the difference ($3,400) represents a net loss for the company.

Question 15

Which of the following appears in the income statement credit column of a worksheet?

Accepted Answer

Service revenue appears in the credit column of the income statement section of a worksheet because it increases the income of the business.

Question 16

The prepaid rent account has a balance that is $400 less in the worksheet's balance sheet debit column than in the worksheet's trial balance debit column. This would be the result of a:

Accepted Answer

A decrease in the balance sheet debit column for prepaid rent compared to the trial balance debit column indicates an adjustment was made to allocate a portion of the prepaid rent to the current period's expense. This is achieved by crediting the prepaid rent account in the adjustments column, which reduces its balance, and debiting the rent expense account (not mentioned in the options but implied by the process).

Question 17

All of the following statements regarding a worksheet are true except:

Accepted Answer

A worksheet is a tool used for planning and not a replacement for journal entries. Adjusting entries must still be recorded in the general journal to update account balances officially.

Question 18

Which of the following appears in the balance sheet debit column of a worksheet?

Accepted Answer

Owner withdrawals appear in the balance sheet debit column of a worksheet because they represent amounts taken out of the business by the owner, reducing the owner's equity.

Question 19

On a worksheet, the sum of the income statement debit column exceeds the sum of the income statement credit column. This indicates the company generated a net income during the current period.

Accepted Answer

If the sum of the income statement debit column exceeds the sum of the income statement credit column, it indicates the company incurred a net loss during the current period, not a net income.

Question 20

The income statement debit column exceeds the income statement credit column on a worksheet. This indicates:

Accepted Answer

When the income statement debit column exceeds the credit column, it indicates the company has incurred a net loss, as expenses (debits) are greater than revenues (credits).

Quiz 4: Completing the Accounting Cycle