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Unformatted text preview: Credit Debit Credit Nominal
Accounts 3 Nominal Accounts . . .
Accounts that are closed to a
zero balance at the end of each
Temporary accounts generally
appearing on the Income
Statement. 10 ACCT 201
ACCT 201 Revenues Revenues Expenses Expenses ACCT 201 What are
closing entries? 4 Closing Entries . . .
Journal entries made at the end
of an accounting period.
They clear all nominal accounts and
prepare them to receive
transactions in the new accounting
They summarize a period’s revenues
13 Purpose of Closing Entries
Closing entries bring the income
statement accounts back to a zero
balance, making them ready for a new
set of transactions.
The closing entry process transfers the
net income or net loss for the
accounting period to the owner’s equity
Reduces owner’s equity for any
distributions to owners. 14 Is there a set
procedure? 5 Introducing a
new account! Account Title Date Item Post.
Ref. Account No. ###
Balance Income Summary
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This document was uploaded on 02/27/2014.
- Spring '14