Refer to the adjusted trial balance of Green Lawns, Inc., illustrated in Exercise 5.2 to respond to the following items.

a. Prepare all necessary closing entries at December 31, current year.
b. Prepare an after-closing trial balance dated December 31, current year.
c. Compare the Retained Earnings balance reported in the after-closing trial balance prepared in part b to the balance reported in the adjusted trial balance. Explain why the two balances are different. (Include in your explanation why the balance reported in the after-closing trial balance has increased or decreased subsequent to the closing process.)

Transcribed Image Text:

GREEN LAWNS, INC ADJUSTED TRIAL BALANCE DECEMBER 31, CURRENT YEAR 10,800 720 28,800 $12,000 3,600 8,400 60,000 108,000 Capltal stock . Dividends 4,800 230,400 124,800 2,880 720 2,400 27,840 $422,400 $422,400