Chapter_4_Key_Terms_and_Concepts - Closing entries 1 Close...

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Chapter 4 – Key Terms and Concepts Steps in the accounting cycle: 1) Analyze and journalize business transactions 2) Post the transactions to the ledger accounts 3) Prepare an unadjusted trial balance 4) Adjustment data are assembled and analyzed 5) Prepare an optional end of period spreadsheet ( worksheet) 6) Journalize and post adjusting entries 7) Prepare an adjusted trial balance 8) Prepare the financial statements 9) Journalize and post closing entries 10) Prepare a post closing trial balance
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Unformatted text preview: Closing entries: 1) Close Revenue to income Summary ( debit Revenue, credit Income Summary) 2) Close expenses to income summary ( debit Income Summary, credit Expenses) 3) Close Income Summary to Retained earnings a) if net income : debit income summary, credit RE b) if net loss : debit RE, credit Income summary 4) Close Dividends to Retained earnings ( debit Retained Earnings, credit dividends)...
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