1) Temporary accounts must be closed at the end of the accounting year,True .False

2) The year-end closing entries are also known as year-end adjusting entries.,True .False

3)Assets are closed to Retained Earnings at the end of the year. true False

4)The Retained Earnings account is a temporary account. True False

5) Liabilities are considered nominal accounts. True False

6) All of the following are financial statements, except:

Trial Balance

Income Statement

Balance Sheet

Statement of Cash Flow

Statement of Retained Earnings

7)At the end of the accounting period, if the accountant failed to record the accrual for Salaries Expense, the Income Statement will be:

Overstated

Understated

Not affected

All of the above

None of the above

8) The adjusting entry for depreciation of equipment will include:

Debit to Depreciation Expense, Equipment

Credit to Depreciation Expense, Equipment

Debit to Accumulated Depreciation, Equipment

Credit to the Equipment

Debit to the Equipment

9) If the bookkeeper failed to record an adjusting entry for accrued interest expense, the effect of this will cause the:

Net income to be overstated

Net loss to be overstated

Assets will be overstated

Assets will be understated

Liabilities will be overstated

10) If the bookkeeper failed to record an adjusting entry for depreciation of the Building account, then:

The Building account will be overstated

The Accumulated Depreciation, Bldg. account will be overstated

The Income Statement will be overstated

The Depreciation, Bldg. account will be overstated

The Liabilities account will be overstated