PART I: MULTIPLE CHOICE QUESTIONS $(30$ POINTS$).$

An account that will have a zero balance after closing entries have been journalized and posted is:

a$.$ Service Revenue

b$.$ Advertising supplies

c$.$ Prepaid Insurance

d$.$ Accumulated Depreciation

T$/$F$.$ When a net loss is incurred in an Income Statement, the closing entry to Capital Account will be Debit to Capital Account and Credit to Income Summary.

The Closing process is as follows:

a$.$ Debit Revenue Account and Credit Income Summary

b$.$ Debit Income Summary and Credit Individual Expense Accounts;

c$.$ Then Close Income Summary Account to Owner's Capital

d$.$ All of the above

e$.$ Only a and $b$ above.

Which type of account will appear in the post$-$closing trial balance?

a$.$ Permanent $($real$)$ accounts

b$.$ Temporary $($nominal $)$ accounts

c$.$ Accounts shown in the Income Summary

d$.$ None of the above.

e$.$ Only b and c above.

Current Assets are listed in the balance sheet in the order of:

a$.$ Liquidity

b$.$ Importance

c$.$ Longevity

d$.$ Alphabets

e$.$ None of the above

Current liabilities are listed in the balance sheet in the order of:

a$.$ Early maturity

b$.$ Importance

c$.$ Alphabets

d$.$ All of the above

e$.$ None of the above.

T$/$F$.$ Long$-$lived assets are also known as fixed assets.

T$/$F$.$ Long$-$term liabilities represent debts owed for more than $1$ year or operating cycle whichever is longer

Gross Profit will result if:

a$.$ Operating expenses are less than net income

b$.$ Sales revenues are greater than operating expenses

c$.$ Sales Revenues are

d$.$ greater than cost of goods sold

e$.$ None of the above.