Lesson 16 2

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Lesson 16 2

  1. 1. LESSON 16-2 Recording Closing Entries for Income Statement Accounts CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
  2. 2. 2 THE INCOME SUMMARY ACCOUNT CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning page 487 LESSON 16-2
  3. 3. 3 CLOSING ENTRY FOR ACCOUNTS WITH CREDIT BALANCES 3 page 488 3 1 2 4 1. Heading 2. Date 3. Debits to close 4. Credit to Income Summary CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 16-2
  4. 4. 4 CLOSING ENTRY FOR INCOME STATEMENT ACCOUNTS WITH DEBIT BALANCES 1. 2. 3. 4. page 489 Date Account debited Credits to close Debit amount 3 3 1 2 4 CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 16-2
  5. 5. SUMMARY OF CLOSING ENTRY FOR INCOME STATEMENT ACCOUNTS WITH DEBIT BALANCES Bal. (New Bal. zero) Adj. (mdse. inv.) Closing (debit accounts) Purchases 209,960.00 Closing (New Bal. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning page 490 209,960.00 Income Summary 15,840.00 Closing (credit amounts) 404,099.15 5 500,253.10 80,313.95) LESSON 16-2
  6. 6. CLOSING ENTRY TO RECORD NET INCOME 6 page 491 1 2 3 1. Date 2. Debit Income Summary 3. Credit Retained Earnings CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 16-2
  7. 7. 7 CLOSING ENTRY FOR DIVIDENDS page 491 1 2 3 1. Date 2. Debit Retained Earnings 3. Credit Dividends CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 16-2
  8. 8. 8 COMPLETED CLOSING ENTRIES FOR A CORPORATION RECORDED IN A JOURNAL CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning page 492 LESSON 16-2

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