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Visit the following Internet site:Type in "Annual report" in the search box to locate the most recent annual report and then findthe consolidated statement of financial position. Identify the major headings within the balancesheet and calculate the current ratio for the most recent year. Write a memo to your instructorsummarizing your findings.Answers to self-testTrue-falseTrue. The three trial balances are the unadjusted trial balance, the adjusted trial balance, andthe post-closing trial balance. The first two trial balances appear on the work sheet.False. If a debit-balance account (such as Prepaid Rent) is credited in the adjustment, theamount in the Adjustments columns is deducted from the amount in the Trial Balance columns todetermine the amount for that item in the Adjusted Trial Balance columns.True. The net loss appears in the Income Statement credit column to balance the IncomeStatement columns. Then the loss appears in the Statement of Retained Earnings debit columnbecause it reduces Retained Earnings.True. All of these accounts are closed, or reduced to zero balances, as a result of the closingprocess.False. All revenue and expense accounts have zero balances after closing.False. Some manual accounting systems are still in use.Multiple-choiceb.The other accounts are very likely to be adjusted. The Land account would be adjusted only ifan error has been made involving that account.c.The Adjusted Trial Balance columns should balance before items are spread to the IncomeStatement, Statement of Retained Earnings, and Balance Sheet columns. Therefore, if the BalanceSheet columns do not balance, the error is likely to exist in the last six columns of the work sheet.d.The net income for the period does not appear in the balance sheet. It does appear in all of theother places listed.a.The Dividends account is closed to the Retained Earnings account rather than to the IncomeSummary account.
b. Plant, property, and equipment is one of the long-term asset categories. Response (a) shouldnot include equipment. Response (c) should not include notes receivable. Stockholders' equity isnot subdivided into current and long-term categories.Comprehensive review problemLopez Delivery Service Company has the following chart of accounts:Acct.Acct.No.Account TitleNo.Account Title100Cash310Retained Earnings103Accounts Receivable320Dividends107Supplies on Hand400Service Revenue108Prepaid Insurance507Salaries Expense112Prepaid Rent511Utilities Expense140Buildings512Insurance Expense141Accumulated Depreciation—Buildings515Rent Expense150Trucks518Supplies Expense151Accumulated Depreciation—Trucks520Depreciation Expense—Buildings200Accounts Payable521Depreciation Expense—Trucks206Salaries Payable568Miscellaneous Expense300Capital Stock600Income SummaryThe post-closing trial balance as of 2010 May 31, was as follows:LOPEZ DELIVERY SERVICE COMPANYPost-Closing Trial Balance2010 May 31Acct.