80) From the following items in the income statement columns of the worksheet of Friend’s Tutoring at
December 31, prepare the closing entries without explanation, assuming that a $1,000 withdrawal was
made during the period.
Income Statement
Account Debit Credit
Tutoring Fees 3,450
Wages Expense 700
Rent Expense 600
Supplies Expense 450
Insurance Expense 250 _____
2,000 3,450
Net Income 1,450 _____
$3,450 $3,450
81) From the following items in the income statement columns of the worksheet of Monaghan Company
at December 31, prepare the closing entries without explanation, assuming that a $500 withdrawal was
made during the period.
Income Statement
Account Debit Credit
Service Revenue 900
Wages Expense 550
Rent Expense 250
Supplies Expense 100
Insurance Expense 50 ____
950 900
Net Loss ____ 50
$950 $950
82) A summary of selected ledger accounts appear below for S. Ball for the current calendar year.
Answer the following questions.
1. What was the total amount of withdrawals for the year?
2. What was the net income?
3. What was the total revenue?
4. What were the total expenses?
83) On the basis of the following data taken from the adjusted trial balance columns of the worksheet for
the year ended December 31 for Painting the Perfect Picture, journalize the four closing entries in the
proper order.
Account Debit Credit
Cash 20,000
Accounts Receivable 67,000
Supplies 7,000
Equipment 200,000
Accumulated Depreciation 70,000
Accounts Payable 30,000
Capital 200,250
Withdrawals 25,000
Fees Earned 100,000
Salary Expense 27,000
Rent Expense 17,500
Depreciation Expense 20,000
Supplies Expense 12,500
Miscellaneous Expense 4,250 ______
Total 400,250 400,250
84) What are the major goals of the closing process?
85) Determine the ending owner’s equity of a business having a beginning owner’s equity of $4,200,
withdrawals of $1,500, and after closing the revenues and expenses Income Summary has a credit balance
of $4,750.
$ ________
86) Determine the beginning owner’s equity of a business having an ending owner’s equity of $6,200,
withdrawals of $2,250, and after closing the revenues and expenses, the Income Summary account has a
debit balance of $3,500.
$ ________
87) Why will the Income Summary account never appear on a financial statement?
88) Determine the beginning assets of a business having ending liabilities of $4,000, the liabilities
decreased by $1,500 during the year, an ending owner’s equity of $10,700, additional investments of
$2,000, withdrawals of $15,600, and after closing the revenues and expenses the Income Summary
account has a credit balance of $6,800.
$ ________
5.3 Learning Objective 5-3
1) The final step in the accounting cycle is:
A) preparing the post-closing trial balance.
B) preparing the financial statements.
C) journalizing the closing entries.
D) journalizing the adjusting entries.
2) Which of the following sequence of actions describes the proper order in the accounting cycle?
A) Journalize, post, close, prepare financial statements, adjust, and analyze transactions
B) Prepare financial statements, journalize, post, adjust, analyze transactions, close
C) Analyze transactions, journalize, post, adjust, prepare financial statements, close
D) Post, close, prepare financial statements, adjust, analyze transactions, and journalize
3) In the normal accounting cycle the:
A) financial statements are prepared after the adjusting entries are posted.
B) financial statements are prepared before the adjusting entries are posted.
C) adjusting and closing entries are journalized before the financial statements are prepared.
D) post-closing trial balance is prepared before the closing entries are posted.
4) Of the following accounts, which might appear in the adjusted trial balance, but not in the post-closing
trial balance?
A) Income Summary
B) Owner’s Capital
C) Accounts Payable
D) Depreciation Expense
5) Which of the following accounts would appear on the post-closing trial balance?
A) Fees Earned
B) Rent Expense
C) Owner’s Capital
D) Income Summary
6) After closing the revenue and expense accounts, Income Summary showed a debit balance of $2,000.
Which of the following statements is true?
A) The company had a net loss of $2,000.
B) The company had a net income of $2,000.
C) The company’s cash increased $2,000.
D) None of these answers are correct.
7) The trial balance prepared after all of the temporary accounts have been closed is called a post-closing
trial balance.
8) The Income Summary account can be found on the worksheet.
9) The post-closing trial balance contains the true ending figure for Capital.
10) The post-closing trial balance is used to determine if the ledger is in balance after closing.
11) All closing entries must be posted before preparing the post-closing trial balance.
12) From the following accounts, prepare in proper form a post-closing trial balance for Logan‘s Pet
Sitting on December 31. (Note: These balances are before closing).
Logan, Capital $7,400
Cash 2,000
Accumulated Depreciation 1,500
Equipment 5,000
Accounts Payable 900
Logan, Withdrawals 1,000
Wages Expense 2,250
Supplies Expense 775
Accounts Receivable 3,125
Personal Trainer Fees 4,350
13) From the following accounts, prepare in proper form a post-closing trial balance for Matison
Company on December 31.
Accounts Receivable $4,600
Accounts Payable 1,290
Cash 6,450
Salaries Payable 1,660
Supplies 500
Prepaid Insurance 1,200
Matison, Capital 9,800