Identify if this is true or false.

1. Since the worksheet already shows the net income or net loss, there is no need to make an income statement.

2.A worksheet is a multicolumned paper that aids in the preparation of the financial statements.

3. Income statement and balance sheet figures are the same as those in the adjusted trial balance

4. Following the rules of debits and credits is an assurance of accuracy of the resulting information in the income statement and balance sheet.

5. The accounting cycle is the process that produces reports on the result of operations and financial position.

6. The balances in the adjusted trial balance columns of the worksheet are extended either to the income statement columns or to the balance sheet columns.

7. Assets are either current or noncurrent.

8. Closing entries are made to zero-out balance sheet accounts.

9. At the beginning of an accounting period, the balances of income statement account are all zero.

10. Closing journal entries is the same as closing the ledgers.

Problem 2

1. How would you go about doing the financial statements requested by the business owner?

2. What specific financial statements will you be preparing for submission to the city government?