Lesson ProgressPhase 5 of 6
Phase 5Assessment
Assessment: Closing Entries: Resetting Temporary Accounts
MCQ exit ticket on temporary vs permanent accounts and closing-entry logic
Exit Ticket: Closing Entries
This short check confirms you can distinguish temporary from permanent accounts, follow the four-step closing sequence, and reason through common closing-entry scenarios.
Aim for at least 80% (4 out of 5 correct). If you miss any, review the explanation and revisit Phase 2 before moving on.
What This Checks
- • Temporary vs permanent account identification
- • Income Summary balance calculations
- • Purpose of the closing process
- • Retained Earnings after closing
What This Does NOT Check
- • Adjusting entry calculations (Lesson 02)
- • Excel or automation skills (Lessons 05-06)
- • Full month-end checklist (Lesson 04)
Closing Entries Exit Ticket
Answer all five questions. Review any explanations for questions you miss.
1. Which of the following accounts is a permanent account that is NOT closed at the end of the period?
2. A company has Service Revenue of $15,000, Rent Expense of $4,000, and Salaries Expense of $6,000. After completing Steps 1 and 2 of the closing process, what is the balance in Income Summary?
3. Why does the closing process use an Income Summary account instead of closing revenue and expenses directly to Retained Earnings?
4. After all closing entries are posted, which of the following accounts should have a zero balance?
5. Sarah's business has beginning Retained Earnings of $8,000, net income of $3,500, and dividends of $1,000. What is the ending Retained Earnings after closing?
0 of 5 questions answered