Acc Hw Accounting Revised

Surname 1

Name

Instructor

Course

Date

What are the steps in recording closing entries?

Temporary accounts such as revenue, capital withdrawal, and expense are usually reset at

the end of each financial period so that they have zero balances when a subsequent accounting

period sets in. Closing entries encompasses journal particulars that transfer temporary accounts

balances to permanent accounts for future reference (Larson et al 34). The sequence followed in

recording closing entries is as follows:

 Closing revenue account to income account for purposes of income calculation. A closed

revenue account prepares it to accumulate revenue of the following accounting period.

 Closing of expenses account to income summary to establish the firm’s financial position

at the end of a financial year. All expenditures including debts are reduced to zero to make

the expense account ready for the subsequent accounting period.

 Closing income details to retained earnings to assess the state of the firm’s capital, that is,

if there is an additional income achieved or loss to the firm.

 Closing dividends to retained earnings for readiness of the next accounting period.

What accounts are affected by closing entries?

Closing entries happen at the end of each accounting cycle. The entries at the end of an

accounting period serve to supplement accounting information to permanent accounts, with

Surname 2

temporary accounts being primary sources of data (Larson et al 25). In essence the balances of

these accounts are usually rolled over into the next accounting period. The accounts subjected to

this form of alteration are namely, withdrawals, revenue, expenses, and income summary accounts.

What accounts are not affected?

 Asset account does not change at the end of a financial period since it is not a nominal

account.

 Liabilities account remains the same as the creditors details are forwarded to the next

financial year.

What is the purpose of the Income Summary account?

The income summary account is a nominal record used at the close of an accounting period

to indicate the effect of revenues and expenses. The account illustrates the net income after

deductions of expenses, depreciation, and taxes are made (Larson et al 22).

What tasks are aided by a work sheet?

Accounting worksheets make it possible for businesses to prepare financial statements

essential in showing their performance rates (Larson et al 89). The following tasks are executed

smoothly courtesy of worksheets.

 Planning ahead by considering interim financial statements to make informed decisions.

 Checking calculations through scrutiny of accounting entries, and formulas.

 Preparing raw trial balances that streamline the preparation of financial statements.

 Entering trial entries that need adjustments from accountants.

Surname 3

Debit and credit entries in the Adjustments columns of the work sheet are identified with

letters to make the contemporary approach of making adjustment in nominal accounts convenient

in the case of making changes.

Why are the debit and credit entries in the Adjustments columns of the work sheet

identified with letters?

The worksheet is a multi-column document thus there is need to save on space so that all the

accounting information can fit (Larson et al 39). The information ought to be fed in the sheets in

brief and precise perspective.

What is a company’s operating cycle?

This refers to a time period a company receives the output of its capital fund investment,

mainly into its cash account (Larson et al 18). The operating cycle is vital in categorizing current

assets and liabilities.

What classes of assets and liabilities are shown on a typical classified balance sheet?

A classified balance sheet opens up information about a company’s assets, liabilities, and

the shareholder’s equity (Larson et al 71). The categorizes that are reflected on a classified

balanced sheet are namely current assets such as petty cash and stock, long term investment like

machinery, current liabilities such as salaries, and long term liabilities like a five-year bank loan.

How is unearned revenue classified on the balance sheet?

Unearned revenue is cash received from a customer for undone work (Larson et al 29).

This kind of revenues is considered to be a current liability on the balance sheet.

Surname 4

What are the characteristics of plant assets?

Plant assets are a company’s fixed assets such as machinery, computers, buildings, and land

(Larson et al 12). The characteristics of the plant assets are as follows:

 They are tangible with physical presence.

 They are used in operation to manufacture, process or realize the end products.

 They have a long span of life that start at the end of a complete year.

 Apart from land, a majority of plant assets depreciate in value.

How do reversing entries simplify recordkeeping?

Reversing entries refers to scrutinizing previous entries by adjusting the records at the start

of the following financial year (Larson et al 69). Reversing of entries omits double capturing of

expenses that can cause an imbalance in the ledger.

Surname 5

Work cited

Larson, Kermit D., John J. Wild, and Barbara Chiappetta. Fundamental accounting principles.

USA: McGraw-Hill Irwin, 2017.

Place new order. It's free, fast and safe

Paper type

Deadline

Page count

550 words

Total price: $ 15.00

Our customers say

Jeff Curtis

USA, Student

"I'm fully satisfied with the essay I've just received. When I read it, I felt like it was exactly what I wanted to say, but couldn’t find the necessary words. Thank you!"

Ian McGregor

UK, Student

"I don’t know what I would do without your assistance! With your help, I met my deadline just in time and the work was very professional. I will be back in several days with another assignment!"

Shannon Williams

Canada, Student

"It was the perfect experience! I enjoyed working with my writer, he delivered my work on time and followed all the guidelines about the referencing and contents."

Acc hw Accounting Revised

Place new order. It's free, fast and safe

Our customers say

Jeff Curtis

Ian McGregor

Shannon Williams