18 terms

Chapter 8

Adjusting Entries
Journal entries recorded to update general ledger accounts at the end of a fiscal period.
Permanent Accounts
Accounts used to accumulate information from one fiscal period to the next.
Temporary Accounts
Accounts used to accumulate information until it is transferred to the owner's capital account.
Closing Entries
Journal entries used to prepare for a new fiscal period.
Post Closing Trial Balance
A proof of the general ledger prepared after the closing entries are posted.
Accounting Cycle
A series of accounting activities included in recording financial information for a fiscal period.
Which accounts are adjusted?
Supplies Expense
Prepaid Insurance Insurance Expense
Real Accounts are the same as. . .
Permanent Accounts
Nominal Accounts are the same as . . .
Temporary Accounts
Equation to find ending Capital
Beg. Capital + Net Income(-net loss) - drawing
Steps to the accounting cycle
Prepare a work sheet
Prepare financial statements
Journalize adjusting and closing entries
Post adjusting and closing entries
Prepare a Post-closing trial balance
Which accounts are affected by closing, but not closed.
Owner's Capital
Normal balance side of the Income Summary account?
Doesn't have one
Which accounts are affected by closing?
Revenue, Expenses, Drawing, Income Summary, Capital
Close Revenue to. . .
Income Summary
Close Expenses to. . .
Income Summary
Close Income Summary to . . .
Owner's Capital
Close Drawing to. . .
Owner's Capital