Review this chapter’s opening feature involving Cathy Hughes and Urban One.

Required

1. Explain how a classified balance sheet can help Cathy know which accounts and amounts are due within the next year and whether the business has the resources to pay for them.

2. Why is it important for Cathy to match costs and revenues in a specific time period? How do closing entries help the business in this regard?

3. What objectives are met when Cathy applies closing procedures each fiscal year-end?