Closing Entries

Closing Entries

Temporary accounts that are closed at

the end of a financial period are:
Revenues
Expenses
Dividends
The account balances for Revenues and Expenses
are closed to an account called Income Summary.
The account balance for Income Summary is
closed to Retained Earnings. Dividends is closed
straight to Retained Earnings.
Adjusted Trial Balance
Close Revenues to Income Summary.
Step 1.
Close Expenses to Income Summary.
Step 2.
Close Net Income to Retained Earnings.
Step 3.
Close Dividends to Retained Earnings
Step 4.
Closing Trial Balance