Chapter 4, Problem 4.7E

(a)

To determine

Journalizing: It is the process of recording the transactions of an organization in a chronological order. Based on these journal entries recorded, the amounts are posted to the relevant ledger accounts.

Accounting rules for journal entries:

• To increase balance of the account: Debit assets, expenses, losses and credit all liabilities, capital, revenue and gains.
• To decrease balance of the account: Credit assets, expenses, losses and debit all liabilities, capital, revenue and gains.

Closing entries: Closing entries are those journal entries which are passed to transfer the balances of temporary accounts to the permanent accounts. These are passed at the end of the accounting period, to transfer the final balance.

Accounting rules for closing entries are:

• Debit the account: All temporary accounts with credit balances.
• Credit the account: All temporary accounts with debit balances

To Prepare: (a)The closing entries as on June 30, 2017 (b) post-closing trial balance.

(b)

To determine

Post Closing Trial Balance: The trial balance which lists all balance sheet accounts is called as post closing trial balance. It is prepared when all the closing entries are summarized and are transferred to their particular ledgers account.

To Prepare: post-closing trial balance.