1 / 9

Adjusting, Closing, and Reversing Entries for Corporations in Accounting

This lesson provides a comprehensive overview of adjusting, closing, and reversing entries in corporate accounting. It covers the procedures for handling accounts with credit and debit balances, including the steps for recording entries in the Income Statement, transferring balances to the Income Summary, and the treatment of net income and dividends. Additionally, it outlines the accounting cycle for a merchandising business organized as a corporation, including journalizing, posting, and preparing financial statements and trial balances.

clinton-dawson
Télécharger la présentation

Adjusting, Closing, and Reversing Entries for Corporations in Accounting

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. LESSON 22-4 Adjusting, Closing, and Reversing Entries for a Corporation

  2. ADJUSTING ENTRIES page 654 LESSON 22-4

  3. CLOSING ENTRY FOR ACCOUNTS WITH CREDIT BALANCES page 655 1 2 1. Enter the balance of accounts in the Income Statement credit column as a debit. 2. Enter the total of the debit entries as a credit to Income Summary. LESSON 22-4

  4. CLOSING ENTRY FOR ACCOUNTS WITH DEBIT BALANCES page 656 1. Enter the account title Income Summary. 1 3 2. Enter the balance of every account in the Income Statement debit column as a credit. 2 3. Enter the total of the credit entries as a debit to Income Summary. LESSON 22-4

  5. CLOSING ENTRY TO RECORD NET INCOME page 657 1 2 1. Debit Income Summary. 2. Credit Retained Earnings. LESSON 22-4

  6. CLOSING ENTRY FOR DIVIDENDS page 657 1 2 1. Debit Retained Earnings. 2. Credit Dividends. LESSON 22-4

  7. 1 REVERSING ENTRIES page 658 1. Reverse the entry that created a balance in Interest Receivable. 2. Reverse the entry that created a balance in Interest Payable. 3. Reverse the entry that created a balance in Federal Income Tax Payable. 2 3 LESSON 22-4

  8. ACCOUNTING CYCLE FOR A MERCHANDISING BUSINESS ORGANIZED AS A CORPORATION page 659 1. Source documents are checked for accuracy, and transactions are analyzed into debit and credit parts. 2 1 2. Transactions, from information on source documents, are recorded in journals. 3 3. Journal entries are posted to the accounts payable, accounts receivable, and general ledgers. 4 4. Schedules of accounts payable and accounts receivable are prepared from the subsidiary ledgers. (continued on next slide) LESSON 22-4

  9. ACCOUNTING CYCLE FOR A MERCHANDISING BUSINESS ORGANIZED AS A CORPORATION page 659 5. A work sheet, including a trial balance and an adjustment for federal income tax expense, is prepared from the general ledger. 9 6. Financial statements are prepared from the work sheet. 8 7. Adjusting and closing entries are journalized from the work sheet and posted to the general ledger. 5 8. A post-closing trial balance of the general ledger is prepared. 7 9. Reversing entries are journalized and posted to the general ledger. 6 (continued from previous slide) LESSON 22-4

More Related