16) The entry to close the appropriate insurance account at the end of the accounting period is to debit: A) Income Summary; credit Prepaid Insurance. B) Prepaid Insurance; credit Income Summary. C) Income Summary; credit Insurance Expense. D) Insurance Expense; credit Income Summary. 17) The balance in the Insurance Expense account of the worksheet was $355. The journal entry to close the Insurance Expense account is: A) Insurance Expense 355 Capital 355 B) Insurance Expense 355 Prepaid Insurance 355 C) Insurance Expense 355 Income Summary 355 D) Income Summary 355 Insurance Expense 355 Unit 2 Examinatio 18) The business failed to close any of the revenue accounts, this error will cause: A) the assets will be overstated. B) the liabilities will be overstated. C) before closing it, Income Summary will have a debit balance. D) before closing it, Income Summary will have a credit balance. 19) The entry to close the revenue account(s) was entered in reverse - Income Summary was debited and the revenue account(s) was/were credited, this error will: A) before closing it, Income Summary will have a debit balance. B) the liabilities will be overstated. C) before closing it, Income Summary will have a credit balance. D) the assets will be overstated. 20) A restrictive endorsement on a check: A) permits the bank to use its best judgment. B) can be further endorsed by someone else. C) is the safest endorsement for businesses. D) None of these answers are correct. 21) The one who pays the check is the: A) drawee. B) payee. C) drawer. D) payer. 22) Key points in working with a checkbook should include: A) the number of the check is preprinted on the check. B) the amount written in words should start on the far left. C) the stub will be used in recording transactions and future reference. D) all of the above. 23) An example of electronic funds transfer is: A) the same as a deposit in transit. B) a transfer of funds without the use of paper checks. C) a transfer of funds by writing a check. D) All of these are correct. 24) The August bank statement for Mobile Service shows a balance of $8,900, but the balance per books shows a cash balance of $8,310. Other information includes: 1. A check for $10 was recorded on the books as $100. 2. Included on the bank statement was a note collected by the bank for $600 plus interest of $40. 3. Checks outstanding totaled $480. 4. Bank service charges were $20. 5. Deposits in transit were $600. Which item(s) should be subtracted from the balance per books? A) Checks outstanding and bank service charge B) Bank service charge and note collected by the bank C) Bank service charge D) Deposit in transit 25) From the bank reconciliation no entry was recorded for the interest on a note collected. This would cause: A) liabilities to be understated. B) assets to be overstated. C) liabilities to be overstated. D) assets to be understated