3.3 Prepare financial statements from an adjusted trial balance
1) Using the adjusted trial balance, the first financial statement to prepare is the income statement.
2) The adjusted trial balance is prepared before the adjusting entries are completed and posted.
3) After preparing the adjusted trial balance, those figures are used to complete the balance sheet only.
4) Net income or net loss can be determined by the adjusted trial balance figures.
5) Adjusting entries are completed before the unadjusted trial balance is prepared.
6) The dollar figures in the adjusted columns are added to or subtracted from the unadjusted trial balance amounts to determine the adjusted trial balance figures.
7) The adjusted trial balance will directly show:
A) the total in the cash account.
B) the final total in the retained earnings account.
C) the total of the adjustments.
D) the accounts that were adjusted.
E) the income.
8) The adjusted trial balance shows:
A) accounts that may still be out of balance.
B) revenues and expense amounts only.
C) assets, liabilities, and revenue amounts only.
D) numbers ready to be transferred to the financial statements.
E) assets, liabilities, and shareholder's equity amounts only.
9) The adjusted trial balance total:
A) is equal to the unadjusted trial balance total.
B) is greater than the unadjusted trial balance total.
C) is less than the unadjusted trial balance total.
D) has no direct relationship to the unadjusted trial balance total.
E) is equal to the unadjusted trial balance.
10) The balance in the depreciation expense account on the adjusted trial balance:
A) is equal to the unadjusted trial balance total.
B) has no relationship to the trial balance.
C) is greater than the unadjusted trial balance total.
D) is less than the unadjusted trial balance total.
E) has no relationship to the unadjusted trial balance total.