Chapter 6

Question 1

The length of time for which a business summarizes and reports financial information

Answer 1

Fiscal period

Question 2

A columnar accounting from used to summarize the general ledger information needed to prepare financial statements

Answer 2

Work sheet

Question 3

A proof of equality of debits and credits in a general ledger

Answer 3

Trial balance

Question 4

Changes recorded on a worksheet to update general ledger accounts at the end of a fiscal period

Answer 4

Adjustments

Question 5

A financial statement that reports assets, liabilities, and owners equity on a specific date

Answer 5

Balance sheet

Question 6

A financial statement showing the revenue and expenses for a fiscal period

Answer 6

Income statement

Question 7

The difference between total revenue and total expenses when total revenue is greater

Answer 7

Net income

Question 8

The difference between total revenue and total expenses when total expenses are greater

Answer 8

Net loss

Question 9

A columnar accounting from used to summarize the general ledger information needed to prepare financial statements

Answer 9

Work sheet

Question 10

A proof of equality of debits and credits in a general ledger

Answer 10

Trial balance

Question 11

Changes recorded on a worksheet to update general ledger accounts at the end of a fiscal period

Answer 11

Adjustments

Question 12

A financial statement that reports assets, liabilities, and owners equity on a specific date

Answer 12

Balance sheet

Question 13

A financial statement showing the revenue and expenses for a fiscal period

Answer 13

Income statement

Question 14

The difference between total revenue and total expenses when total revenue is greater

Answer 14

Net income

Question 15

The difference between total revenue and total expenses when total expenses are greater

Answer 15

Net loss

Question 16

The accounting concept consistent reporting is being applied when a delivery business reports revenue for the number of deliveries made one year and the amount of revenue received for the deliveries made the next year

Answer 16

False

Question 17

An accounting period is also known as a fiscal period

Answer 17

True

Question 18

Journals,ledgers,and worksheets are considered permanent records

Answer 18

False

Question 19

All general ledger account titles are listed on a trial balance in the same order as listed on the chart of accounts

Answer 19

True

Question 20

The four questions asked when analyzing an adjustment are: why?where? When? And How?

Answer 20

False

Question 21

The two accounts affected by the adjustment for supplies and supplies expense

Answer 21

True

Question 22

Totaling and ruling the adjustments columns of a work sheet is necessary to prove the equality of debits and credits

Answer 22

True

Question 23

Two financial statements are prepared from the information on the worksheet

Answer 23

True

Question 24

Net income on a work sheet is calculated by subtracting the income statement credit column total from the income statement debit column total

Answer 24

False

Question 25

If errors are found on a worksheet they must be erased and corrected before any further work is completed

Answer 25

True

Question 26

When two column totals are not in balance on the work sheet the difference between the two totals is calculated and checked

Answer 26

True

Question 27

If the difference between the totals of debit and credit columns on a work sheet can be evenly divided by 9 then the error is most likely in addition

Answer 27

False

Question 28

If there are errors in the work sheets trial balance columns it might be because not all general ledger account balances were copied in the trial balance column correctly

Answer 28

True

Question 29

Errors in general ledger accounts should never be erased

Answer 29

True

Question 30

Most errors occur in doing arithmetic

Answer 30

True

Question 31

The best way to prevent errors is to use a calculator

Answer 31

False