Accounting Principles: Closing Temporary Accounts

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Questions and Answers

What is the total of all expenses incurred during the year?

  • $125,000
  • $79,000
  • $254,000 (correct)
  • $150,000

What is the ending capital of the owner as of December 31, 2017?

  • $95,300
  • $32,000
  • $70,300 (correct)
  • $126,700

What is the total assets of the company as of December 31, 2017?

  • $102,300 (correct)
  • $95,300
  • $126,700
  • $70,300

What is the total revenues of the company for the year ended December 31, 2017?

<p>$72,000 (D)</p> Signup and view all the answers

What is the total liabilities of the company as of December 31, 2017?

<p>$95,300 (D)</p> Signup and view all the answers

What is the net profit of the company for the year ended December 31, 2017?

<p>$23,300 (B)</p> Signup and view all the answers

What is the total amount of revenues recorded in the income summary?

<p>$150,000 (D)</p> Signup and view all the answers

What is the total amount of expenses recorded in the income summary?

<p>$126,700 (A)</p> Signup and view all the answers

What is the net income after closing the revenues and expenses in the income summary?

<p>$23,300 (C)</p> Signup and view all the answers

What is the amount of drawings closed to capital?

<p>$25,000 (B)</p> Signup and view all the answers

What is the balance of capital after closing the net income and drawings?

<p>$70,300 (D)</p> Signup and view all the answers

What is the total debit balance of the post-closing trial balance?

<p>$102,300 (A)</p> Signup and view all the answers

What is the primary purpose of closing temporary accounts?

<p>To have a fresh start for the next year and measure the accounts separately (D)</p> Signup and view all the answers

Which type of account is not closed?

<p>Asset account (C)</p> Signup and view all the answers

What is the sequence of closing entries?

<p>Revenue to income summary, expenses to income summary, income summary to capital, drawings to capital (A)</p> Signup and view all the answers

What is the purpose of the income summary account?

<p>To close revenue and expense accounts (D)</p> Signup and view all the answers

What is the purpose of the fourth closing entry?

<p>To close drawings to capital (D)</p> Signup and view all the answers

What is the result of closing the temporary accounts?

<p>The accounts will have a zero balance (D)</p> Signup and view all the answers

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