Question : 31) The Income Summary account shows debits of $29,000 and : 1171310

 

31) The Income Summary account shows debits of $29,000 and credits of $20,000. This results in a:

A) net income of $49,000.

B) net loss of $49,000.

C) net income of $9,000.

D) net loss of $9,000.

32) After closing the revenue, expense, and withdrawal accounts, the capital increased by $2,000. Which of the following situations could have occurred?

A) The company had a net income.

B) The owner invested an additional amount.

C) The owner made a withdrawal.

D) All of these answers are correct.

33) The income statement credit column of the worksheet showed the following revenues:

 

Catering Fees Earned

$600

Cleaning Fees Earned

800

 

The journal entry to close the revenue accounts is:

A)

Income Summary

1,400

Catering Fees Earned

600

Cleaning Fees Earned

800

 

B)

Catering Fees Earned

600

Cleaning Fees Earned

800

Income Summary

1,400

 

C)

Capital

1,400

Income Summary

1,400

 

D)

Catering Fees Earned

600

Cleaning Fees Earned

800

Capital

1,400

34) The business failed to close any of the revenue accounts. The result of this error is that:

A) revenues will be understated.

B) capital will be understated.

C) the assets will be overstated.

D) the liabilities will be overstated.

35) The entry to close the expense account(s) was entered in reverse—Income Summary was credited and the expense account(s) was/were debited. The result of this error is that:

A) before closing it, Income Summary will have a credit balance.

B) before closing it, Income Summary will have a debit balance.

C) the assets will be understated.

D) the liabilities will be understated.

36) The entry to close the revenue account(s) was entered in reverse—Income Summary was debited and the revenue account(s) was/were credited. The result of this error is that:

A) before closing it, Income Summary will have a credit balance.

B) before closing it, Income Summary will have a debit balance.

C) the assets will be overstated.

D) the liabilities will be overstated.

37) The following normal account balances were found on the general ledger before closing entries were prepared:

 

Revenue $900

Cash $500

Expenses $500

Accounts Receivable $350

Capital $7,500

Withdrawals $1,000

 

After closing entries are posted, what is the balance in the Revenue account?

A) $800

B) $0

C) $400

D) Closing entries do not affect Revenue.

38) The following normal account balances were found on the general ledger before closing entries were prepared:

 

Revenue $1,100

Cash $600

Expenses $600

Accounts Receivable $400

Capital $7,500

Withdrawals $1,000

 

After closing entries are posted, what is the balance in the Capital account?

A) $8,000

B) $7,500

C) $7,000

D) Closing entries do not affect the Capital account.

39) The following normal account balances were found on the general ledger before closing entries were prepared:

 

Revenue $800

Cash $500

Expenses $400

Accounts Receivable $350

Capital $7,500

Withdrawals $1,000

 

After closing entries are posted, what is the balance in the Cash account?

A) $800

B) $0

C) $300

D) $500.

40) The entry to close the Withdrawal account was entered in reverse—the Withdrawal account was debited and Capital credited. The result of this error is that:

A) before closing it, Income Summary will have a credit balance.

B) before closing it, Income Summary will have a debit balance.

C) the end of period capital will be understated.

D) the end of period capital will be overstated.