1. What is the third step in the accounting cycle? Answer Analyze source documents and record business transactions in a journal Prepare a post-closing trial balance Journalize and post the closing entries. Prepare a trial balance. Which of the following accounts would be closed during the closing process? If Inc lit balance before closing entries, which following would be the appropriate closing entry to Answer Income from Services Cash 20,400 20.400 Income from Services 20,400 Income Summary 20,400 Income Summary 20,400 J. Crestview, Capital 20,400 5. Crestview, Capital 20,400 Income from Services 20,400 Which of the following accounts would appear on a post-closing trial Answer 1. Depreciation Expense, Equipment 2. Income from Services 3. R. McDonald, Drawing 4. R. McDonald, Capital 5. Under the cash basis of accounting, which of the following statements is true? Answer 1. Revenue is recorded when it is earned, regardless of when the cash is received. 2. Expenses are recorded when they are paid. 3. Expenses are recorded when they are incurred, regardless of when the cash is paid. 4. The cash basis of accounting is allowed for all corporations. are prepared during the fiscal year for periods of less than 12 months. Answer Worksheets 2. Intermediary statements 3. Interim statements 4. In-between statements