Chapter 6 Flashcards
What is an Income Summary Account
A special owner’s equity account used only after the closing process to summarize results of operation
What is another name for revenue?
Fees Income
When you reduce an account balance to zero what are you doing
Closing the account
Where do you transfer net loss or net income?
To Owner’s Equity
Should there be a balance in Income Summary after you have closed the account?
no
Where is an owner’s withdrawal taken from?
A deduction of capital from the Owner’s Equity
What is a post closing trial balance?
The 8th step in the accounting cycle and is used to prove the equality of debits and credits
What is it called when you understand and explain the meaning and importance of information in accounting reports?
Interpret. It is the last 9th and final step in the accounting cycle.
Do you record adjusting entries before or after closing entries
Before.
The balance of expense accounts should be zero at the end of the accounting period. Where do you post their totals?
Post as a DEBIT to Income Summary accounts and a CREDIT to Expenses
True or False:
Heidi is ridiculous about flash cards.
True
