基础会计学第四单元课件英文版.ppt

We can see that the balance in the Income Summary is zero and the balance in the capital account has been updated. The final closing entry is to close Withdrawals to Owner’s Capital. Let’s take a look at the journal entry. We debit, or reduce, Owner’s Capital by $200 and credit the Withdrawal account for the same amount. The Withdrawal account now has a zero balance and the Owner’s Capital has been updated to the balance of $33,585. This balance appears on the balance sheet of FastForward. Here is an overview of the closing process we just completed. Take a few minutes to study the steps as outlined, which will help you to understand the entire closing process. After all four of our closing entries have been made, we prepare a post-closing trial balance. This trial balance should show only permanent accounts, that is assets, liabilities, and the capital account. All the revenues, expenses, and withdrawals have been reduced to zero balances. The balance in all the temporary (income statement and owner’s withdrawal accounts) are zero and the post-closing trial balance lists all the permanent accounts with their current balances. Notice that the owner’s capital account has been updated to include net income and owner’s withdrawals. The term accounting cycle refers to the steps in preparing financial statements. It is called a cycle because the steps are repeated each reporting period. There are ten steps in the cycle which include: 1. Analyze transactions -- Analyze transactions to prepare for journalizing. 2. Journalize -- Record accounts, including debits and credits, in a journal. 3. Post -- Transfer debits and credits from the journal to the ledger. 4. Prepare unadjusted trial balance -- Summarize unadjusted ledger accounts and amounts. 5. Adjust -- Record adjustments to bring account balances up to date; journalize and post adjustments. 6. Prepare adjusted trial balance -- Summarize adjusted ledger accounts and amounts. 7. Prepare statements -- Use adjusted tri