Accounting Chapter 10- Completing the Accounting Cycle for a Sole Proprietorship

Compound entry

A(n) __________ has two or more debits or credits in the general journal

Permanent accounts

The only accounts and balances listed on the post-closing trial balance are the __________ of the business

Temporary Accounts

The __________ are used to record transactions involving revenue, expenses, and withdrawals

Income Summary Account

The general ledger account is used to accumulate and summarize the revenue and expenses for the period is __________

post-closing trial balance

The trial balance prepared after the closing entries have been posted is the __________

closing entries

Journal entries that close out the balances in the temporary accounts and transfer the net income or net loss for the period to the capital account are called __________

False

Before the closing entries are journalized and posted, there is only one account in the general ledger that shows the revenue and expenses for the fiscal period.

False

The last step in the accounting cycle is to journalize and post closing entries

True

When the revenue account is closed, Income Summary is credited

False

To close an expense account, debit it for the amount of its credit balance

True

Closing the withdrawals account into the capital account is the last closing entry to be made

False

Closing entries are made for all temporary accounts and all permanent accounts

False

To close a revenue account, credit it for the amount of its debit balance

False

The income summary account can be found on the income statement

False

A separate closing entry is needed for each expense account

True

The balances of the revenue and expense accounts apply to only one fiscal period

Capital account

Closing entries are used to transfer the net income or net less for the period to the

Capital account

To close a withdrawals account, the amount of its balance is debited to the

a credit to income summary, a debit to capital

If a business had a net loss for the period, the journal entry to close out the balance of the income summary account into the capital account would be

Eighth step

In the accounting cycle, the closing process represents the

zero balances

Temporary accounts start each fiscal period with

revenue account to the income summary

The first step in journalizing closing entries is to transfer the balance of the

work sheet

the source of information for the closing entries is the