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Match the Description with the Accounting Terms

Question 97

Matching

Match the description with the accounting terms.

Premises:

Responses:

To understand and explain the meaning and importance of something (such as financial statements)

Closing entries

Journal entries that transfer the results of operations (net income or net loss) to owner's equity and reduce the revenue, expense, and drawing account balances to zero

Income Summary account

A statement that is prepared to prove the equality of total debits and credits after the closing process is completed

Interpret

A special owner's equity account that is used only in the closing process to summarize the results of operations

Post-closing trial balance

Premises:

To understand and explain the meaning and importance of something (such as financial statements)

Journal entries that transfer the results of operations (net income or net loss) to owner's equity and reduce the revenue, expense, and drawing account balances to zero

A statement that is prepared to prove the equality of total debits and credits after the closing process is completed

A special owner's equity account that is used only in the closing process to summarize the results of operations

Responses:

Closing entries

Income Summary account

Interpret

Post-closing trial balance

Correct Answer:

Premises:

Responses:

To understand and explain the meaning and importance of something (such as financial statements)

Journal entries that transfer the results of operations (net income or net loss) to owner's equity and reduce the revenue, expense, and drawing account balances to zero

A statement that is prepared to prove the equality of total debits and credits after the closing process is completed

A special owner's equity account that is used only in the closing process to summarize the results of operations

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