Chapter 4
Closing Entries and Post-Closing
Trial Balance
结账以及结账后试算平衡表
The Accounting Cycle
Journalize
transactions.
Post entries to
the ledger
accounts.
Prepare trial
balance.
Prepare after closing Journalize and
post closing
trial balance.
entries.
Prepare
financial
statements.
Make end-ofyear
adjustments.
Prepare adjusted
trial balance.
Permanent/real accounts vs.
temporary/nominal accounts
• Permanent accounts or real accounts
(永久性账户或实账户）
--- Accounts that remain open all the time until
the business is liquidated.
• Temporary accounts or nominal accounts
(临时性账户或虚账户）
--- Accounts that apply to only one accounting
period and that are closed at the end of that
accounting period.
Permanent/real accounts vs.
temporary/nominal accounts
Assets = Liabilities + Capital + Revenue – Expenses – Drawing
Permanent accounts
Open
Temporary accounts
Closed
Closing the Temporary Equity
Accounts
The closing （结账）
process gets the
temporary/nominal
accounts
（临时性/虚账户）
ready for the next
accounting period.
Closing entries (结账分录）
• Closing entries
--- journal entries made at the end of a fiscal
year to reduce the balances of the
temporary accounts to zero.
Expense
Dr
Bal. 100
0
Revenue
Cr
Dr
Closing 100 Closing 100
Cr
Bal. 100
0
Income Summary
(收益总汇/本年利润）
Income Summary
Expenses bal.
Net loss
(if R< E)
Revenue Bal.
Net income
(if R > E)
Closing the “Temporary” Equity
Accounts
Close Revenue accounts
to Income Summary.
Close Expense accounts
to Income Summary.
Close Income Summary
account to Owner’s
Capital.
Close Withdrawals to
Owner’s Capital.
The closing process
gets the temporary
accounts ready for the
next accounting
period.
Closing Entries for Revenue
Accounts
Income Summary
xxxx
Sales Revenue
xxxx
xxxx
-
xxxx
Closing Entries for Expense
Accounts
Gasoline Exp.
xx
xx
Depr. Exp.: Tools &
Equipment
xxx
xxx
Depr. Exp.: Truck
xxxx
xxxx
-
Income Summary
xx
xxxx
xxx
xxxx
xxx
Net Income
Closing the Income Summary
Account
Income Summary
xxx
Jill Jones, Capital
xxxxx
xxx
xxx
The balance in Income
Summary is now zero.
Closing the Owner’s Drawing
Account
Jill Jones, Drawing
xxx
xxx
-
Jill Jones, Capital
xxx
xxxx
Closing
procedures
summary
Expenses
+
Bal.
Closing
Revenue
+
Closing Bal.
Income Summary
Expenses
Revenue
Closing
Net income
Net loss
Closing
drawing
+
Bal. Closing
Capital
+
Drawing Bal.
Net loss
Net income
Journalizing and posting
Journalize and post closing entries.
On page 90-91.
Compound entry.
Post-closing trial balance on page 95.
Assignments
• Problem 3 (p 99)
• Self-test comprehensive problems I
End of Chapter 4