TRUE OR FALSE 6.It is not necessary to prepare formal financial statements if a worksheet has been prepared because financial position and net income are shown on the worksheet. 7.The balance of the depreciation expense account will appear in the income statement debit column of a worksheet. 8.After closing entries have been journalized and posted, all temporary accounts in the ledger should have zero balances.
TRUE OR FALSE
6.It is not necessary to prepare formal financial statements if a worksheet has been prepared because financial position and net income are shown on the worksheet.
7.The balance of the depreciation expense account will appear in the income statement debit column of a worksheet.
8.After closing entries have been journalized and posted, all temporary accounts in the ledger should have zero balances.
9.Closing entries are unnecessary if the business plans to continue operating in the future and issue financial statements each year.
10.The owner's drawing account is closed to the Income Summary account in order to properly determine net income (or loss) for the period.
11.Closing revenue and expense accounts to the Income Summary account is an optional bookkeeping procedure.
12.Closing the drawing account to Capital is not necessary if net income is greater than owner's drawings during the period.
13.The owner's drawing account is a permanent account whose balance is carried forward to the next accounting period.
14.Closing entries are journalized after
15.The amounts appearing on an income statement should agree with the amounts appearing on the post-closing
16.The post-closing trial balance is entered in the first two columns of a worksheet.
17.A business entity has only one accounting cycle over its economic existence.
18.The accounting cycle begins at the start of a new accounting period.
19.Both correcting entries and adjusting entries always affect at least one balance sheet account and one income statement account.
20.Correcting entries are made any time an error is discovered even though it may not be at the end of an accounting period.
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