Question :
26) M. Smuts showed a net income of $6,000. The : 1177397
26) M. Smuts showed a net income of $6,000. The entry to close the Income Summary account would include a:
A) debit to M. Smuts Capital, $6,000.
B) credit to M. Smuts Capital, $6,000.
C) debit to Income Summary, $6,000.
D) Both B and C are correct.
27) J. Oros showed a net loss of $3,200. The entry to close the Income Summary account would include a:
A) debit to Oros, Capital, $3,200.
B) debit to Income Summary , $3,200.
C) credit to Oros, Capital, $3,200.
D) credit to Cash, $3,200.
28) The balance in the J. Higgins, Withdrawals account was $4,200. The entry to close the account would include a:
A) debit to Income Summary, $4,200.
B) credit to Income Summary, $4,200.
C) debit to J. Higgins, Capital, $4,200.
D) debit to J. Higgins, Withdrawals, $4,200.
29) The balance in the Rent Expense account on the worksheet was $120. The journal entry to close the Rent Expense account is:
A)
Rent Expense
120
Prepaid Rent
120
B)
Rent Expense
120
Income Summary
120
C)
Rent Expense
120
Capital
120
D)
Income Summary
120
Rent Expense
120
30) B. Benson’s worksheet showed the revenue account, Rental Fees, $1,300. The journal entry to close the account is:
A)
Rental Fees
1,300
Income Summary
1,300
B)
Benson, Capital
1,300
Rental Fees
1,300
C)
Rental Fees
1,300
Benson, Capital
1,300
D)
Income Summary
1,300
Rental Fees
1,300
31) The Income Summary account shows debits of $19,000 and credits of $10,000. This results in a:
A) net income of $29,000.
B) net loss of $29,000.
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
$500
Cleaning Fees
800
The journal entry to close the revenue accounts is:
A)
Income Summary
1,300
Catering Fees
500
Cleaning Fees
800
B)
Catering Fees
500
Cleaning Fees
800
Income Summary
1,300
C)
Capital
1,300
Income Summary
1,300
D)
Catering Fees
500
Cleaning Fees
800
Capital
1,300
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 overstated.
D) the liabilities will be overstated.
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