Question: A business’s yearly accounting period is called the

Answer: fiscal year.

Question: Why do companies base their fiscal year on a natural business cycle?

Answer: It’s at the low point in the operating cycle and provides time to analyze operations and prepare financial statements.

Question: Why should investors and others be careful in interpreting partial-year reports for companies that use the natural business year for their fiscal year?

Answer: The operations of the companies vary significantly throughout the fiscal year.

Question: The Cash balance on the adjusted trial balance will be carried over to

Answer: the Debit column of the balance sheet on the work sheet.

Question: Net income on the Income Statement section of the work sheet will

Answer: be carried over to the Credit column of the balance sheet on the work sheet.

Question: Revenue accounts appear on the _____.

Answer: ncome statement

Question: Owner withdrawals would appear on the _____.

Answer: statement of owner’s equity

Question: The following accounts are closed at the end of the accounting period except _____.

Answer: capital

Question: Which account will not appear on the post-closing trial balance?

Answer: Revenue

Question: The journal entry required to close the Drawing account is _____.

Answer: a debit to Capital account and a credit to Drawing account