A list of all accounts and their balances after posting closing entries is referred to as:

A) A trial balance.

B) An adjusted trial balance.

C) A post-closing trial balance.

D) An accounting trial balance.

Answer: C

A post-closing trial balance:

A) Is a list of all accounts and their balances after adjusting entries.

B) Is a list of all accounts and their balances before adjusting entries.

C) Is a list of all accounts and their balances after closing entries.

D) Is a trial balance adjusted for cash-basis accounting.

Answer: C

Which one of the following accounts would NOT have a balance after closing entries?

A) Deferred Revenue.

B) Supplies.

C) Prepaid Rent.

D) Dividends.

Answer: D

Of the following six accounts, which ones have temporary balances:

(1) Service Revenue

(2) Dividends

(3) Salaries Expense

(4) Common Stock

(5) Retained Earnings

(6) Cash

A) (1), (2), and (3).

B) (4), (5), and (6).

C) (2), (4), and (5).

D) (1), (3), and (5).

Answer: A

Temporary accounts would not include:

A) Salaries Payable.

B) Advertising Expense.

C) Supplies Expense.

D) Dividends.

Answer: A

Which of the following accounts will NOT be involved in closing entries?

A) Prepaid Insurance.

B) Service Revenue.

C) Utilities Expense.

D) Retained Earnings.

Answer: A

Which of the following is true concerning temporary and permanent accounts?

A) Cash is a temporary account.

B) Permanent accounts represent activity over the entire life of the company.

C) Permanent accounts must be closed at the end of every reporting period.

D) Temporary accounts represent activity over the previous three years.

Answer: B

Which of the following is a permanent account?

A) Dividends.

B) Service Revenue.

C) Advertising Expense.

D) Retained Earnings.

Answer: D

The purpose of closing entries is to transfer:

A) Accounts Receivable to Retained Earnings when an account is fully paid.

B) Balances in temporary accounts to a permanent account.

C) Inventory to Cost of Goods Sold when merchandise is sold.

D) Assets and liabilities when operations are discontinued.

Answer: B

Which of the following describes the purpose(s) of closing entries?

A) Adjust the balances of asset and liability accounts for unrecorded activity during the period.

B) Transfer the balances of temporary accounts to common stock.

C) Reduce the balances of the temporary accounts to zero to prepare them for measuring activity in the next period.

D) Transfer the balances of temporary accounts to common stock; reduce the balances of the temporary accounts to zero to prepare them for measuring activity in the next period.

Answer: C

The primary purpose of closing entries is to:

A) Prove the equality of the debit and credit entries in the general journal.

B) Ensure that all assets and liabilities are recognized in the appropriate period.

C) Update the balance of Retained Earnings and prepare revenue, expense, and dividend accounts for next period's transactions.

D) Assure that adjusting entries balance.

Answer: C

The closing process includes which of the following?

A) Closing the balance of the retained earnings account to zero.

B) Closing the balance of only the dividends account to zero.

C) Closing the balances of only revenue and expense accounts to zero.

D) Closing the balances of revenue, expense and dividend accounts to zero.

Answer: D