LESSON 8 3 Preparing a PostClosing Trial Balance

LESSON 8 -3 Preparing a Post-Closing Trial Balance Original created by M. C. Mc. Laughlin, Thomson/South-Western Modified by Deborah L. Burns, Johnston County Schools, West Johnston High School CENTURY 21 ACCOUNTING © Thomson/South-Western

GENERAL LEDGER ACCOUNTS AFTER ADJUSTING AND CLOSING ENTRIES ARE POSTED 2 page 213 After posting adjusting & closing entries, draw a line in both the balance debit & credit columns for any account that has a zero balance CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 8 -3

3 POST-CLOSING TRIAL BALANCE q. After the closing entries are posted, businesses verify that debits equal credits in the general ledger accounts by preparing a trial balance q. A trial balance prepared after the closing entries are posted is called a post closing trial balance q. Only general ledger accounts with balances are included on a post closing trial balance q. Permanent accounts q. Assets, Liabilities, Owner’s Equity CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 8 -3

4 POST-CLOSING TRIAL BALANCE 4 1 3 2 6 5 7 CENTURY 21 ACCOUNTING © Thomson/South-Western page 216 1. Heading 2. Account titles 3. Account balances 4. Single rule 5. Compare totals 6. Totals 7. Record totals 8. Double rule 8 LESSON 8 -3

5 ACCOUNTING CYCLE FOR A SERVICE BUSINESS The series of accounting activities 8 included in recording financial information for a fiscal period is called an accounting cycle 1 7 1. 2. 3. 4. 5. 2 3 6 page 217 4 Analyzes transactions Journalize Post Prepare work sheet Prepare financial statements 6. Journalize adjusting and closing entries 7. Post adjusting and closing entries 8. Prepare post-closing trial balance 5 CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 8 -3

6 TERMS REVIEW page 219 n post-closing trial balance n accounting cycle CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 8 -3