After the Closing Entries Are Prepared

question 51

Multiple Choice

After the closing entries are prepared:

• A) all asset accounts will have a zero balance.
• B) the Retained Earnings account will have the correct ending balance.
• C) the temporary accounts will have debit balances.
• D) all liability accounts will have a zero balance.

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Definitions:

Job-Order Costing System

A job-order costing system is an accounting method that tracks and accumulates costs for individual jobs or batches, which are distinct and can be separately identified.

Overapplied

A term used in accounting when the allocated overhead costs are more than the actual overhead costs incurred.

Underapplied

Refers to the situation where allocated overhead costs are less than the actual overhead costs incurred.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including labor, materials, and manufacturing overhead.