Question 1

The purpose of an adjusting entry is a/an:
A)Accurate Profit and Loss statement and Balance Sheet.
B)Create menu (+) > Credit Card Credit.
C)Gear > Account and Settings > Advanced.
D)Gear > Manage Users.
E)None.

Accepted Answer

The purpose of an adjusting entry is to ensure accuracy in the financial statements, particularly the Profit and Loss statement and Balance Sheet. Adjustments are made to correct any errors or omissions in the accounts that were not recorded during regular transactions. The final result should be an accurate representation of the company's financial position and performance.

Question 2

The purpose of closing the books is to transfer:
A)Drawing to Sales.
B)Cost of Goods Sold to Accounts Payable.
C)Checking to Accounts Receivable.
D)Net income to Retained Earnings
E)None.

Accepted Answer

Closing the books involves transferring the net income or loss to Retained Earnings. This is done to reset the income and expense accounts for the start of the next accounting period, and to maintain an accurate record of the company's earnings over time. The other options listed do not accurately describe the purpose of closing the books.

Question 3

How do you access Account and Settings?
A)Plus sign for Settings menu.
B)Magnifying-glass for search.
C)Question mark for printing.
D)Gear icon.
E)All.

Accepted Answer

The gear icon is commonly used as a symbol for settings or options, so it is the most logical choice for accessing Account and Settings.

Question 4

In Chapter 7, adjusting entries are dated December 31.

Accepted Answer

Adjusting entries are made at the end of an accounting period to update accounts to their correct balances before creating financial statements. Therefore, they are generally dated as of the last day of the accounting period, which is usually December 31 for companies with a December 31 fiscal year-end.

Question 5

To close the books, change the trial balance date to December 31 of the current year.

Accepted Answer

(To close the books, change the Balance Sheet date to January 1 of the next year.)

Question 6

A list report with amounts can be exported and customized using:
A)The balance sheet.
B)A template.
C)Some apps.
D)Excel.
E)All.

Accepted Answer

Excel provides extensive customization options for formatted reports, making it the best choice for exporting and customizing a list report with amounts.

Question 7

When the Balance Sheet's date is changed to January 1 of the next year, the Retained Earnings account will show the previous year's Net Income; and the Profit and Loss accounts will have zero balances.

Accepted Answer

When the Balance Sheet's date is changed to January 1 of the next year, the Retained Earnings account will show the previous year's Net Income, which is added to the beginning balance of the Retained Earnings account. The Profit and Loss accounts will have zero balances since they have already been closed out to Retained Earnings at the end of the previous year.

Question 8

Use the Settings menu to record journal entries.

Accepted Answer

(To record adjusting entries, use the create menu's Journal Entry selection.)

Question 9

Before completing work in Chapter 7, display the:
A)Export the October 1 trial balance to Excel.
B)Save the November 30 trial balance as a PDF file.
C)October 1 through December 31 trial balance.
D)All.
E)None.

Accepted Answer

The instruction is to display the trial balance for the period from October 1 through December 31, which corresponds to option C.

Question 10

A period that the company uses for accounting purposes and preparing financial statements.
A)First quarter.
B)Fourth quarter.
C)Fiscal year.
D)End of year.
E)None.

Accepted Answer

A fiscal year is a period of 12 months that a company uses for accounting purposes and preparing financial statements. It does not necessarily correspond with the calendar year and can start on any date.

Question 11

Accounts that are closed as the end of the year are called:
A)Permanent accounts.
B)Temporary accounts.
C)Balance sheet accounts.
D)Trial balance accounts.
E)All.

Accepted Answer

Temporary accounts are closed at the end of the accounting period to transfer their balances to permanent accounts. This process helps in preparing the financial statements, and the accounts that are closed are revenue, expense, and dividend accounts.

Question 12

When you close the books, income, cost of goods sold, and expense accounts are reset to zero amounts.

Accepted Answer

At the end of an accounting period, income, cost of goods sold, and expense accounts are closed out to a temporary account (usually Income Summary) to reset their balances to zero for the start of the new accounting period. This process is part of preparing the accounts for the next period's transactions.

Question 13

A software design that emphasizes separating the functions of a program into independent, interchangeable components is called:
A)A user interface.
B)The operating system.
C)Web-delivered software.
D)Modules.
E)All

Accepted Answer

The software design that emphasizes separating the functions of a program into independent, interchangeable components is called modules. A module is a self-contained unit that can be used to build a program by combining other modules. This approach, known as modular programming, makes it easier to maintain, test, and modify software because changes can be made to a specific module without affecting other parts of the program.

Question 14

Products and services can be used to represent different services or goods.

Accepted Answer

Products and services are two different categories that can represent various goods and services provided by a business. Products typically refer to physical goods, while services refer to non-physical, intangible offerings.

Question 15

Adjusting entries are recorded so that the financial statements reflect revenues that are earned and expenses incurred.

Accepted Answer

Adjusting entries are recorded at the end of an accounting period to ensure that the financial statements reflect the accurate amount of revenues earned and expenses incurred during that period. It helps to match the expenses with the related revenues and recognize them in the correct period.

Question 16

A common characteristic of an adjusting entry is that it will include one Profit and Loss statement account and one Balance Sheet account.

Accepted Answer

Adjusting entries are made at the end of an accounting period to record transactions that have occurred but have not yet been recorded. These entries involve at least one income statement account and one balance sheet account to ensure that the financial statements accurately reflect the company's financial position and performance.

Question 17

When does QB Cloud record adjusting entries?
A)Every month.
B)End of the quarter.
C)Weekly.
D)All.
E)None.

Accepted Answer

The answer of When does QB Cloud record adjusting entries?
A)Every...

Question 18

The accounts shown on the balance sheet are called:
A)Permanent accounts.
B)Temporary accounts.
C)Transaction entries.
D)Customized accounts.
E)All.

Accepted Answer

The accounts shown on the balance sheet are permanent accounts because they are accounts that reflect the ongoing financial position of the company, such as assets, liabilities, and equity. These accounts do not get closed at the end of the accounting period, unlike temporary accounts which get closed to zero in preparation for the next accounting period. Transaction entries and customized accounts are not commonly used terms in accounting. Therefore, option E is incorrect.

Question 19

Adjusting entries are recorded on the Invoice page.

Accepted Answer

(Adjusting entries are recorded on the Journal Entry page.)

Question 20

To see the appropriate report balances, type the date range.

Accepted Answer

To see the appropriate report balances, you need to input the specific date range in order to generate accurate and relevant data.

Quiz 7: Analysis and Reportsend of Fourth Quarter and Year

The purpose of an adjusting entry is a/an:

The purpose of closing the books is to transfer:

How do you access Account and Settings?

In Chapter 7, adjusting entries are dated December 31.

To close the books, change the trial balance date to December 31 of the current year.

A list report with amounts can be exported and customized using:

When the Balance Sheet's date is changed to January 1 of the next year, the Retained Earnings account will show the previous year's Net Income; and the Profit and Loss accounts will have zero balances.

Use the Settings menu to record journal entries.

Before completing work in Chapter 7, display the:

A period that the company uses for accounting purposes and preparing financial statements.

Accounts that are closed as the end of the year are called:

When you close the books, income, cost of goods sold, and expense accounts are reset to zero amounts.

A software design that emphasizes separating the functions of a program into independent, interchangeable components is called:

Products and services can be used to represent different services or goods.

Adjusting entries are recorded so that the financial statements reflect revenues that are earned and expenses incurred.

A common characteristic of an adjusting entry is that it will include one Profit and Loss statement account and one Balance Sheet account.

When does QB Cloud record adjusting entries?

The accounts shown on the balance sheet are called:

Adjusting entries are recorded on the Invoice page.

To see the appropriate report balances, type the date range.