Self Assessment Quizzes

CHAPTER 20: Section 1 Journalizing Closing Entries

	1.	When recording closing entries for a merchandising business organized as a corporation, there are

		a.	three closing entries
		b.	four closing entries
		c.	five closing entries
		d.	no closing entries

	2.	Closing entries

		a.	transfer balances from temporary accounts to permanent accounts
		b.	transfer balances from permanent accounts to temporary accounts
		c.	close all temporary and permanent accounts
		d.	are only necessary if there is net income

	3.	To close withdrawals to capital in a corporation

		a.	debit withdrawals and credit income summary
		b.	credit withdrawals and debit income summary
		c.	there is no entry for closing withdrawals in a corporation
		d.	debit income summary and credit capital stock

	4.	The closing entry to record net loss is

		a.	debit income summary and credit retained earnings
		b.	debit retained earnings and credit income summary
		c.	there is no closing entry if there is a net loss
		d.	debit capital stock and credit income summary

	5.	To close the sum of the balances in the Credit column of the Income Statement section of the work sheet which includes revenue and contra cost of merchandise accounts

		a.	debit income summary
		b.	credit income summary
		c.	debit capital stock
		d.	credit capital stock