Yes. The new arrangement of memory implements the logical structure of the linked list.
Here is the code fragment (again):
.data elmnt01: .word 1 .word elmnt02 elmnt02: .word 2 .word elmnt03 elmnt03: .word 3 .word elmnt04 elmnt04: .word 5 .word elmnt05 elmnt05: .word 7 .word 0
And here is how it is assembled by SPIM:
Each element consists of two words of data: the integer followed by the address of the next node. In this memory dump the nodes follow each other in order.