Accounting Cycle quiz

On Apr 10, 2026

Accounting Cycle

10 questions in 10 minutes

Pass Score 70%

1 / 10

A company has purchased a tract of land. It expects to build a production plant on the land in approximately 5 years. During the 5 years before construction, the land will be idle. The land should be reported as:

property, plant, and equipment

land expense

a long-term investment

an intangible asset

2 / 10

When a net loss has occurred, Income Summary is :

credited and Owner’s Drawings is debited

debited and Owner’s Capital is credited

debited and Owner’s Drawings is credited

credited and Owner’s Capital is debited

3 / 10

In a worksheet, net income is entered in the following columns :

income statement (Dr) and balance sheet (Dr)

income statement (Dr) and balance sheet (Cr)

income statement (Cr) and balance sheet (Dr)

income statement (Cr) and balance sheet (Cr)

4 / 10

When the Company purchased supplies worth $100, it incorrectly recorded a credit to Supplies for $1,000 and a debit to Cash for $1,000. Before correcting this error :

Cash is overstated and Supplies is overstated

Cash is overstated and Supplies is understated

Cash is understated and Supplies is understated

Cash is understated and Supplies is overstated

5 / 10

Cash of $100 received at the time the service was performed was journalized and posted as a debit to Cash $100 and a credit to Accounts Receivable $100. Assuming the incorrect entry is not reversed, the correcting entry is :

debit Service Revenue $100 and credit Accounts Receivable $100

debit Cash $100 and credit Service Revenue $100

debit Accounts Receivable $100 and credit Cash $100

debit Accounts Receivable $100 and credit Service Revenue $100

6 / 10

Which of the following statements is incorrect concerning the worksheet ?

The worksheet is essentially a working tool of the accountant

The worksheet cannot be used as a basis for posting to ledger accounts

The worksheet is distributed to management and other interested parties

Financial statements can be prepared directly from the worksheet before journalizing and posting the adjusting entries

7 / 10

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

Accumulated Depreciation—Equipment

Supplies

Service Revenue

Prepaid Insurance

8 / 10

The correct order of presentation in a classifed balance sheet for the following current assets is :

inventory, cash, accounts receivable, prepaid insurance

accounts receivable, cash, prepaid insurance, inventory

cash, accounts receivable, inventory, prepaid insurance

cash, inventory, accounts receivable, prepaid insurance

9 / 10

The proper order of the following steps in the accounting cycle is :

journalize transactions, post to ledger accounts, prepare unadjusted trial balance, journalize and post adjusting entries

prepare unadjusted trial balance, journalize transactions, post to ledger accounts, journalize and post adjusting entries

journalize transactions, prepare unadjusted trial balance, post to ledger accounts, journalize and post adjusting entries

prepare unadjusted trial balance, journalize and post adjusting entries, journalize transactions, post to ledger accounts

10 / 10

In a classif ed balance sheet, assets are usually classifed using the following categories :

current assets; long-term investments; property, plant, and equipment; and intangible assets

current assets; long-term assets; property, plant, and equipment; and intangible assets

current assets; long-term investments; property, plant, and equipment; and tangible assets

current assets; long-term investments; tangible assets; and intangible assets

Your score is

Question topics

Classified balance sheet

Prepare a worksheet

Preparing adjusting entries

Preparing closing entries