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    Marg123's Avatar
    Marg123 Posts: 3, Reputation: 1
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    #1

    Feb 6, 2011, 02:03 PM
    Closing enteries and post-closing trial balance?
    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

    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Feb 6, 2011, 03:06 PM

    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.
    g11m4391's Avatar
    g11m4391 Posts: 2, Reputation: 1
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    #3

    Apr 6, 2011, 10:33 AM
    Dr bank
    Cr cash
    g11m4391's Avatar
    g11m4391 Posts: 2, Reputation: 1
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    #4

    Apr 6, 2011, 10:34 AM
    Comment on g11m4391's post
    Is this the correct answer
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #5

    Apr 6, 2011, 10:46 AM

    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.

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