Chapter 4: 4-20RQ (page 216)
What is the current ratio, and how is it calculated?
Current ratio is a measure which calculates the ability to repay the current liabilities by the current assets. It is calculated by dividing current assets by current liabilities.
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What does liquidity mean?
What are reversing entries? Are they required by GAAP?
For each account listed, identify whether the account would be included on a post-closing trial balance. Signify either Yes (Y) or No (N). a. Office Supplies b. Interest Expense c. Retained Earnings d. Dividends e. Service Revenue f. Accumulated Depreciation—Furniture g. Rent Expense h. Unearned Revenue i. Accounts Payable
For each account listed, identify the category in which it would appear on a classified balance sheet.
2. Mortgage Payable (due in five years)
For each account listed, identify whether the account would appear on the post-closing trial balance. Indicate either yes or no.
18. Cash
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