1) The following is an excerpt from a conversation between Joel Loomis and Krista Truitt just before they boarded a flight to Paris on Delta Air Lines. They are going to Paris to attend their companys annual sales conference. Joel: Krista, arent you taking an introductory accounting course at college? Krista: Yes, I decided its about time I learned something about accounting. You know, our annual bonuses are based on the sales figures that come from the accounting department. Joel: I guess I never really thought about it. Krista: You should think about it! Last year, I placed a $750,000 order on December 28. But when I got my bonus, the $750,000 sale wasnt included. They said it hadnt been shipped until January 3, so it would have to count in next years bonus. Joel: A real bummer! Krista: Right! I was counting on that bonus including the $750,000 sale. Joel: Did you complain? Krista: Yes, but it didnt do any good. Ashley, the head accountant, said something about matching revenues and expenses. Also, something about not recording revenues until the sale is final. I figure Id take the accounting course and find out whether shes just jerking me around. Joel: I never really thought about it. When do you think Delta Air Lines will record its revenues from this flight? Krista: Hmmm . . . I guess it could record the revenue when it sells the ticket . . . or . . . when the boarding passes are taken at the door . . . or . . . when we get off the plane . . . or when our company pays for the tickets . . . or . . . I dont know. Ill ask my accounting instructor. Discuss when Delta Air Lines should recognize the revenue from ticket sales to properly match revenues and expenses.

2)Why are closing entries required at the end of an accounting period?

3)What is the purpose of the post-closing trial balance?