All but Which of the Following Are Areas That Small

question 6

Multiple Choice

All but which of the following are areas that small business owners should concentrate on when analyzing cash flow?

• A) Accounts receivable
• B) Inventory
• C) Their bank
• D) Sales

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Definitions:

Income Summary

An account to which the revenues and expenses are transferred in order to calculate the net income for the period, ultimately transferring to retained earnings.

Accounting Cycle

The series of steps followed by an entity to collect, process, and report financial information, culminating in the preparation of financial statements for a specific period.

Adjusting Entry

Documentation produced at a period's end within accounting to properly allocate profits and outlays to the actual period they happened.

Closing Entry

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts, thereby preparing the books for the next accounting period.