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Identifying Accounts Affected by Closing Entries The following account names appear in
Chapter 20, Problem 20-1(choose chapter or problem)
Identifying Accounts Affected by Closing Entries
The following account names appear in the chart of accounts of Larkin’s Department Store.
Instructions Use the form in your working papers to answer the following questions about each account. Assume that all accounts have normal balances.
1. Is the account affected by a closing entry?
2. During closing, is the account debited or credited?
3. During closing, is Income Summary debited or credited?
Questions & Answers
QUESTION:
Identifying Accounts Affected by Closing Entries
The following account names appear in the chart of accounts of Larkin’s Department Store.
Instructions Use the form in your working papers to answer the following questions about each account. Assume that all accounts have normal balances.
1. Is the account affected by a closing entry?
2. During closing, is the account debited or credited?
3. During closing, is Income Summary debited or credited?
ANSWER:Step 1 of 4
Closing entries are the last step in the completion of the accounting process. Closing entries are done after the preparation of financial statements to close the temporary accounts and transfer them to permanent accounts.