Chapter 4, Problem 1PSB

To determine

Concept Introduction:

General Ledger:

The accounts use to organize all the transactions of a business organization are termed as general ledger accounts.

Requirement 1:

Apply balance column format to prepare each ledger account.

To determine

Concept Introduction:

Journal Entries:

Journal entries are medium of recording the financial transactions which occurred during an accounting year.

Requirement 2:

Journalizing the transaction which occurred during July and posting them to the ledger accounts.

To determine

Concept Introduction:

Unadjusted Trial Balance:

Unadjusted trial balance shows the balance of accounts before adjustments required to be made regarding the adjusting entries.

Requirement 3:

To Prepare:

Prepare the unadjusted trial balance as July 31.

To determine

Concept Introduction:

Adjusting Entries:

The journal entries which shows the expenses and revenue incurred or earned during a particular accounting year are called adjusting entries.

Requirement 4:

Journalizing and posting of adjusting entries for the month.

To determine

Concept Introduction:

Adjusted Trial Balance:

Considering all the expenses and revenue occurred irrespective of whether cash is outstanding or received in advance during an accounting period, the adjusted trial balance shows the accurate balances of all the accounts.

Requirement 5

To Prepare:

Prepare adjusted trial balance, income statement, statement of owner's equity and balance sheet at July 31.

To determine

Concept Introduction:

Closing Entries:

Closing entries intends to close all the temporary accounts and transfer its balances to "income summary account" and then to the owner's capital account. The accounts which are closed at the end of every accounting period are called temporary accounts. Examples: revenue accounts and expenses accounts like salaries, rent, depreciation, insurance, commission expenses, etc.

Requirement 6

To Prepare:

Prepare closing entries to close all the temporary accounts and post them into their concern ledger.

To determine

Concept Introduction:

The trial balance which is prepare after closing all the temporary accounts are termed as post-closing trial balance.

Requirement 7

To Prepare:

Prepare the post-closing trial balance?