Lesson 8-1Closing the Accounting Cycle
Closing the Accounting Cycle
Please note that all slides are available on the class website.
LESSON 8-1
LESSON 8-1
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7. Post adjusting and closing entries
6. Journalize adjusting and closing entries
5. Prepare financial statements
4. Prepare work sheet
Recording Adjusting Entries
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page 202
4. Write the title of the account credited. Record the credit amount.
3. Write the title of the account debited. Record the debit amount.
2. Write the date.
1. Write the heading.
Recording Closing Entries
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permanent accounts
temporary accounts
closing entries
page 212
LESSON 8-2
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TERMS all on page 206 of your text book
Permanent Accounts – Accounts used to accumulate information form one fiscal period to the next. Examples of permanent accounts include asset and liability accounts (balance sheet accounts), as well as the owner’s capital account.
Temporary Accounts – Accounts used to accumulate information until it is transferred to the owner’s capital account. Examples of temporary accounts are revenue and expense accounts (income statement accounts), the owner’s drawing account, and the income summary account.
page 212
LESSON 8-2
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TERMS all on page 206 of your text book
Closing Entries – Journal entries used to prepare temporary accounts for a new fiscal period. The temporary account balances must be reduced to ZERO at the end of each fiscal period.
page 212
LESSON 8-2
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page 207
LESSON 8-2
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LESSON 8-2
CLOSING ENTRY FOR AN INCOME STATEMENT ACCOUNT WITH A CREDIT BALANCE
page 208
1. Write the heading.
2. Write the date.
3. Write the title of the account debited. Record the debit amount.
4. Write the title of the account credited. Record the credit amount.
(Debit to close)
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page 209
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LESSON 8-2
CLOSING ENTRY TO RECORD NET INCOME OR LOSS AND CLOSE THE INCOME SUMMARY ACCOUNT
page 210
3. Credit
2. Debit
1. Date
(Income Summary:
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page 211
3. Credit
2. Debit
1. Date
Preparing a Post-Closing Trial Balance
LESSON 8-1
LESSON 8-3
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GENERAL LEDGER ACCOUNTS AFTER ADJUSTING AND CLOSING ENTRIES ARE POSTED
page 213
LESSON 8-3
LESSON 8-1
LESSON 8-3
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