© south-western educational publishing adjusting entries lesson 26-4, page 677
TRANSCRIPT
© South-Western© South-WesternEducational PublishingEducational Publishing
ADJUSTING ENTRIES ADJUSTING ENTRIES
Lesson 26-4, page 677Lesson 26-4, page 677
© South-Western© South-WesternEducational PublishingEducational Publishing
1. Enter the balance of accounts in the Income Statement credit column as a debit.
CLOSING ENTRY FOR ACCOUNTS WITH CREDIT CLOSING ENTRY FOR ACCOUNTS WITH CREDIT BALANCESBALANCES
1
2
2. Enter the total of debit entries as a credit to to Income Summary.
Lesson 26-4, page 678Lesson 26-4, page 678
© South-Western© South-WesternEducational PublishingEducational Publishing
CLOSING ENTRY FOR ACCOUNTS WITH DEBIT CLOSING ENTRY FOR ACCOUNTS WITH DEBIT BALANCESBALANCES
2. Enter the balance of every account in the Income Statement debit column as a credit.
1 2
3. Enter the total as a debit to Income Summary.
1. Enter Income Summary.
Lesson 26-4, page 679Lesson 26-4, page 679
3
© South-Western© South-WesternEducational PublishingEducational Publishing
1. Debit Income Summary
CLOSING ENTRY TO RECORD NET INCOMECLOSING ENTRY TO RECORD NET INCOME
12
2. Credit Retained Earnings
Lesson 26-4, page 680Lesson 26-4, page 680
© South-Western© South-WesternEducational PublishingEducational Publishing
CLOSING ENTRY FOR DIVIDENDSCLOSING ENTRY FOR DIVIDENDS
12
1. Debit Retained Earnings
2. Credit Dividends
Lesson 26-4, page 680Lesson 26-4, page 680
© South-Western© South-WesternEducational PublishingEducational Publishing
1. Reverse the entry that created a balance in Interest Receivable.
REVERSING ENTRIESREVERSING ENTRIES
2. Reverse the entry that created a balance in Interest Payable.
3. Reverse the entry that created a balance in Federal Income Tax Payable.
1
2
3
Lesson 26-4, page 681Lesson 26-4, page 681
© South-Western© South-WesternEducational PublishingEducational Publishing
ACCOUNTING CYCLE FOR A MERCHANDISING ACCOUNTING CYCLE FOR A MERCHANDISING BUSINESS ORGANIZED AS A CORPORATIONBUSINESS ORGANIZED AS A CORPORATION
5
1
6
4
2
8 3
9
7
1. Source documents checked for accuracy, and transactions are analyzed.
9. Reversing entries are journalized and posted to the general ledger.
2. Transactions are recorded in a journal.
3. Journal entries are posted to ledgers.
4. Schedules of accounts payable and accounts receivable are prepared from subsidiary ledgers.
5. Work sheet is prepared.6. Financial statements are
prepared.
7. Adjusting and closing entries are journalized.
8. A post-closing trial balance is prepared.
Lesson 26-4, page 682Lesson 26-4, page 682