We record a journal entry because there has been either:

Closing of temporary accounts at the end of the accounting period

Quiz

ACC 101 Study - Chapter 3

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1Revenue/Gains = ____________ in cash.
1. Aincreases
2. Bdecreases
3. Cno changes/effect
2Which system of accounting is used in GAAP?
1. ACash Method
2. BAccrual Method
3. CNeither Method
3In the Cash method system of accounting, decreases/losses = _____________ in cash
1. Aincreases
2. Bdecreases
3. Cno changes
4In the Accrual Method system of accounting, revenues/gains are recognized when _____________________________
1. Aearned and measurable
2. Bincurred
3. Cnot recognized
5Using the Accrual method, expenses/losses are recognized when _______________.
1. Aincurred
2. Bearned and measurable
3. Cnot recognized
6Expenditure is _________________________
1. Afunds saved
2. Bfunds spent
3. Cno effect on funds
7Expense is a _______________ of earnings on the Income Statement
1. Aincrease
2. Breduction
3. Cno effect
8Expenditure ________________ equal(s) expense
1. Aalways
2. Bdoesn't always
9We record a journal entry because there has been either:
1. AAn accounting event
2. BA required adjustment
3. CClosing of temporary accounts at the end of the accounting period
4. DAll of the above
5. ENone of the above