Chandler Company Chandler Company is owned by Roscoe Chandler and provides appraisal services to individuals and companies wishing to purchase and sell fine art. Chandler Company began business on January 1, 2018, and is just completing its first year of business. Roscoe asks for your help in completing the accounting cycle for the company by assisting with the closing process. Chart of Accounts CHART OF ACCOUNTS Chandler Company General Ledger ASSETS REVENUE 11 Cash 41 Fees Earned 12 Accounts Receivable 42 Rent Revenue 16 Prepaid Insurance 43 Interest Revenue 18 Equipment 19 Accumulated Depreciation-Equipment EXPENSES 51 Salaries Expense LIABILITIES 52 Selling Expense 21 Accounts Payable 53 Income Taxes Expense 22 Salaries Payable 54 Depreciation Expense-Equipment 24 Income Taxes Payable 55 Insurance Expense 59 Miscellaneous Expense EQUITY 31 Roscoe Chandler, Capital 32 Roscoe Chandler, Drawing The Closing Process Shaded cells have feedback. X The final step of the accounting cycle is the closing process. The main goal of this stage of the cycle is to ensure that the balance of each temporary account is returned to zero and that net income is transferred to the owner's capital account. The first step in successfully undertaking the closing process is to understand the difference between a temporary account and a permanent account. Roscoe has some questions about the process. Answer the following questions (1) - (3). 1. If a temporary account has an ending balance of $62,000, what is its beginning balance for the following accounting period? If there is no amount or an amount is zero, enter "0". $0 Points: 1/1 Feedback Check My Work Review the definition of a temporary account and what happens to it at the end of the accounting period. 2. If a permanent account has an ending balance of $62,000, what is its beginning balance for the following accounting period? $ Points: 0/1 Feedback Check My Work Chapter 04 Mastery (Mastery) Mastery Problem: Completing the Accounting Cycle Chandler Company Chart of Accounts Adjusted Trial Balance The Closing Process Roscoe's Journal Journal Post-Closing Trial Balance Roscoe's Journal Determine which entry is incorrect, and journalize both closing entries for Chandler Company as of Dec. 31 on the Journal panel. PAGE 25 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DERIT CREDIT ASSETS LABILMES FQUITY Closing Entries 2 Dec. 31 Roscoe Chandler, Capital 471,600.00 + 5 Fees Earned 185,500.00 1 4 Rent Revenue 92,000.00 1 5 Interest Revenue 1 17,200.00 71,000.00 $ Salaries Expense 1 2 Selling Expense 25,500.00 1 ! 15,000.00 1 1 47,200.00 1 LG Income Taxes Expense Depreciation Expense-Equipment Insurance Expense Miscellaneous Expense 31 Roscoe Chandler, Capital 17,000.00 1 11 1,000.00 1 12 5,000.00 + LS Roscoe Chandler, Drawing 5,000.00 1 Journal Shaded cells have feedback How does grading work? PAGE 25 JOURNAL Score: 134/147 ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 1 Closing Entries 2 Dec. 31 Roscoe Chandler, Capital 3 Fees Earned 4 Rent Revenue 5 Interest Revenue 6 Salaries Expense 71,000.00 t 7 8 8 15,000.00 t 9 Selling Expense Income Taxes Expense Depreciation Expense-Equipment Insurance Expense Miscellaneous Expense 47,200.00 1 20 17,000.00 t V 11 1,000.00 t 12 Dec. 31 Roscoe Chandler, Capital 5,000.00 + 15 Roscoe Chandler, Drawing 5,000.00 t Points: 23.7 / 26 Post-Closing Trial Balance Shaded cells have feedback. X The post-closing trial balance shows all the permanent accounts with their updated values after the temporary accounts have been reduced to zero balance for the next accounting cycle. Also, the post-closing trial balance is meant to ensure that debits equal credits post-close. Roscoe is very happy with your work on the closing entries for Chandler Company, and asks if you would prepare a post-closing trial balance for the company. Question not attempted. Chandler Company Score: 0/39 POST-CLOSING TRIAL BALANCE December 31, 2018 ACCOUNT TITLE DEBIT CREDIT 1 Cash 2 Accounts Receivable 3 Prepaid Insurance 4 Equipment 5 Accumulated Depreciation-Equipment 6 Accounts Payable 1 Salaries Payable 8 Income Taxes Payable Roscoe Chandler, Capital 9 10 Totals Points: 0/11