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Chapter 4: Q4TI_5 (page 201)

For each account listed, identify whether the account would appear on the post-closing trial balance. Indicate either yes or no.

20. Retained Earnings

Short Answer

Expert verified

YES

Step by step solution

01

Step-by-Step-SolutionStep 1: Explanation on Post Closing Trial Balance

Post closing trial balance is prepared after recording the closing entries. It only reports the permanent account of the business.

02

Explanation on Retained Earnings

Retained earnings indicates the accumulated profits of the previous years. It is a permanent account, hence reported in post closing trial balance, and also reported in balance sheet under equity section.

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Most popular questions from this chapter

What does liquidity mean?

How is the Income Summary account used? Is it a temporary or permanent account?

This problem continues the Canyon Canoe Company situation from Chapter 3.

Requirements

1. Complete the worksheet at December 31, 2018 (optional). Use the unadjusted trial balance from Chapter 2 and the adjusting entries from Chapter 3.

2. Prepare an income statement for the two months ended December 31, 2018. Use the worksheet prepared in Requirement 1 or the adjusted trial balance from Chapter 3.

3. Prepare a statement of retained earnings for the two months ended December 31, 2018.

4. Prepare a classified balance sheet (report form) at December 31, 2018. Assume the note payable is long-term.

5. Journalize and post the closing entries at December 31, 2018. Open T-accounts for Income Summary and Retained earnings. Determine the ending balance for each account. Denote each closing amount as Clos.and each account balance as Balance.

6. Prepare a post-closing trial balance at December 31, 2018.

For each account listed, identify whether the account would appear on the post-closing trial balance. Indicate either yes or no.

16. Dividends

Refer to the Practice Set data provided in Chapters 2 and 3 for Crystal Clear Cleaning.

Requirements

1. Prepare a worksheet (optional) at November 30, 2018. Use the unadjusted trial balance from Chapter 2 and the adjusting entries from Chapter 3.

2. Prepare an income statement and statement of retained earnings for the month ended November 30, 2018. Also prepare a classified balance sheet at November 30, 2018, using the report format. Assume the Notes Payable is long-term. Use the worksheet prepared in Requirement 1 or the adjusted trial balance from Chapter 3.

3. Prepare closing entries at November 30, 2018, and post to the accounts. Open T-accounts for Income Summary and Retained earnings. Determine the ending balance in each account. Denote each closing amount as Clos. and each account balance as Balance.

4. Prepare a post-closing trial balance at November 30, 2018.
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