$ $ $ $ Section 2 Posting Closing Entries What You’ll Learn Chapter 20 How to post closing entries. How to prepare a post-closing trial balance. The accounting cycle for a merchandising business. $ $

$ $ $ $ Why It’s Important Chapter 20 Section 2 Posting Closing Entries (cont'd.) Chapter 20 $ Why It’s Important To prepare the general ledger for the next period, you need to transfer the temporary account balances to the permanent Retained Earnings account. $ $ $

$ $ $ $ Closing the General Ledger Chapter 20 Section 2 Posting Closing Entries (cont'd.) Chapter 20 $ Closing the General Ledger $ After closing entries are recorded in the general journal, they are posted to the general ledger. For each posting the term “Closing Entry” is written in the Description column of the general ledger account. $ $

$ $ $ $ Preparing a Post-Closing Trial Balance Chapter 20 Section 2 Posting Closing Entries (cont'd.) Chapter 20 $ Preparing a Post-Closing Trial Balance $ A post-closing trial balance is prepared at the end of the accounting period to prove that the general ledger accounts are in balance after all adjusting and closing entries are posted. $ A, L + SE (Retained earnings and capital stock) no income summary $

$ $ $ $ Check Your Understanding Chapter 20 Section 2 Posting Closing Entries (cont'd.) Chapter 20 $ Check Your Understanding $ After all closing journal entries are posted, what is the balance of the temporary accounts? $ $