The following adjusted trial balance contains the accounts and balances of Dayton Company as of December 31, 2008 the end of its fiscal year. (1) Prepare the December 31, 2008 closing entries for Dayton Company. (2) Prepare the December 31, 2008 Post closing trial balance for cruz Company.


Cash 19,680
Accounts Recivable 13200
Merchandise Inventory 17100
Equipment 60000
Accumulated depreciation-equipment 6000
Account Payable 5400
Income Tax Payable 5000
Common Stock ($1 par) 2000
Paid in capital in excess of par 6000
Retanied Earnings 16500
Sales Revenue 269000
Cost of goods sold 103700
Wage Expense 91,200
Utility Expense 6120
Rent Expense 7100
Depr. Expense- Equipment 6000
Income Tax Expense 5000
Totals 99,100 99,100

Step 1. You need to close out your revenue accounts to the Income Summary Account.

Step 2. You need to close out your expense acounts to your Income Summary Account.

Step 3. You need to close out your Income Summary Account to Retained Earnings.

Step 4. You need to prepare a post-closing trial balance.

Dr bank
Cr cash

Is this the correct answer

You do not close out the Cash account, as it is a Balance Sheet Account.

You only close out Income Statement accounts, i.e. Revenues and Expenses.

See my previous post for the steps involved.