Chapter 17 Recording Adjusting and Closing Entries for a Partnership

Adjusting Entries We adjust accounts that we do not change over a period of time. We adjust accounts that we do not change over a period of time. We bring those accounts up to date or “Adjust” them so that they are correct at the end of the year. We bring those accounts up to date or “Adjust” them so that they are correct at the end of the year.

Account TitleTrial BalanceAdjustments DebitCreditDebitCredit Merchandise Inventory (a)15840 Supplies - Office6480 (b)4730 Supplies - Store6944 (c)3910 Prepaid Insurance5800 (d)3170 Income Summary (a)15840 Insurance Expense (d)3170 Supplies Expense - Office (b)4730 Supplies Expense - Store (c)3910 Worksheet General JournalPage 1 Date Account TitleDoc NoPost RefDebitCredit Adjusting Entries Dec31Income Summary Merchandise Inventory Supplies Expense - Office 4730 Supplies - Office Supplies Expense - Store 3910 Supplies - Store Insurance Expense 3170 Prepaid Insurance 3170

Closing Entries We have done this once before. We have done this once before. Here are the steps that we use Here are the steps that we use Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Credit column of the income statement column.

Please look at page 400 in text book General JournalPage 2 Date Account TitleDoc NoPost RefDebitCredit Closing Entries Dec31Sales Income Summary Close all credit balance accounts in the income statement column.

Closing Entries We have done this once before. We have done this once before. Here are the steps that we use Here are the steps that we use Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Debit column of the income statement column. Close all of the accounts in the Debit column of the income statement column.

General JournalPage 2 Date Account TitleDoc NoPost RefDebitCredit Closing Entries Dec31Sales Income Summary Dec31Income Summary Purchases Advertising Expense 6600 Credit Card Expense 3385 Insurance Expense 3170 Miscellaneous Expense Payroll Taxes Expense 9105 Rent Expense Salary Expense Supplies Expense - Office 4730 Supplies Expense - Store 3910 Utilities Expense 3820 Close all of the accounts in the Debit column of the income statement column. Close all of the accounts in the Debit column of the income statement column.

Closing Entries We have done this once before. We have done this once before. Here are the steps that we use Here are the steps that we use Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Debit column of the income statement column. Close all of the accounts in the Debit column of the income statement column. Close the income summary into the capital accounts Close the income summary into the capital accounts

Omni Imports Distribution of Net Income Statement Karl Kohen 50% of Net Income $ 34, Michelle Wu 50 % of Net Income $ 34, Net Income $ 69, We need to take a look at our Distribution of net income and it should match what the balance Of our income summary account is…… From this point on we can not use the worksheet to get our information General JournalPage 2 Date Account TitleDoc NoPost RefDebitCredit Closing Entries Dec31Sales Income Summary Dec31Income Summary Purchases Advertising Expense 6600 Credit Card Expense 3385 Insurance Expense 3170 Miscellaneous Expense Payroll Taxes Expense 9105 Rent Expense Salary Expense Supplies Expense - Office 4730 Supplies Expense - Store 3910 Utilities Expense 3820 Dec31Income Summary Karl Kohen,Captial Michelle Wu, Captial

Closing Entries We have done this once before. We have done this once before. Here are the steps that we use Here are the steps that we use Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Credit column of the income statement column. Close all of the accounts in the Debit column of the income statement column. Close all of the accounts in the Debit column of the income statement column. Close the income summary into the capital accounts Close the income summary into the capital accounts Close the drawing accounts into the capital accounts Close the drawing accounts into the capital accounts

We go back to the worksheet on page 400 and look at the drawing accounts. We need to Make those accounts zero. General JournalPage 2 Date Account TitleDoc NoPost RefDebitCredit Closing Entries Dec31Sales Income Summary Dec31Income Summary Purchases Advertising Expense 6600 Credit Card Expense 3385 Insurance Expense 3170 Miscellaneous Expense Payroll Taxes Expense 9105 Rent Expense Salary Expense Supplies Expense - Office 4730 Supplies Expense - Store 3910 Utilities Expense 3820 Dec31Income Summary Karl Kohen, Captial Michelle Wu, Capital Dec31Karl Kohen, Capital Karl Kohen, Drawing Michelle Wu, Capital Michelle Wu, Drawing 28800

Post-closing trial balance Now that we have closed all of the temporary accounts. Now that we have closed all of the temporary accounts. We need to make sure that the rest of our permanent accounts are still in balance. We need to make sure that the rest of our permanent accounts are still in balance.

Encore Music Post-Closing Trial Balance August 31, 20xx Account TitleDebitCredit Cash Petty Cash300 Accounts Receivable Merchandise Inventory Supplies - Office1750 Supplies - Store3034 Prepaid Insurance2630 Accounts Payable Employee Income Tax Payable 542 Social Security Tax Payable Medicare Tax Payable Sales Tax Payable Unemployment Tax Payable- Fed 8.4 Unemployment Tax Payable - State 56.7 Health Insurance Premiums payable 1008 U.S. Savings Bonds Payable 61 United Way Donations Payable 72 Karl Koehn, Capital Michelle Wu, Capital Totals

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