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Download This documents contains lessons about accounting. and more Study notes Accounting in PDF only on Docsity! OST SENIOR HIGH SCHOOL Fundamentals of Accountancy, Business and Management 1 (FABM 1) Preparing of Post Closing Trial Balance Self-Learning Module 5 666 Quarter 4 Fundamentals of Accountancy, Business and Management 1 Quarter 4 – Self-Learning Module 4: Preparing of Post-Closing Trial Balance First Edition, 2020 Republic Act 8293, Section 176 states that no copyright shall subsist in any work of the Government of the Philippines. However, prior approval of the government agency or office wherein the work is created shall be necessary for exploitation of such work for profit. Such agency or office may, among other things, impose as a condition the payment of royalties. Borrowed materials (i.e., songs, stories, poems, pictures, photos, brand names, trademarks, etc.) included in this module are owned by their respective copyright holders. Every effort has been exerted to locate and seek permission to use these materials from their respective copyright owners. The publisher and authors do not represent nor claim ownership over them. Published by the Department of Education - Schools Division of Pasig City Printed in the Philippines by Department of Education – Schools Division of Pasig City Development Team of the Self-Learning Module Writer: Jeany Rose P. Agbisit Editor: Edna D. Camarao, PhD., Dennis T. Alex Reviewers: Content/Language: Edna D. Camarao, PhD., Jennifer M. Hobrero Technical: Emmanuel B. Penetrante Management Team: Ma. Evalou Concepcion A. Agustin OIC-Schools Division Superintendent Carolina T. Rivera, CESE OIC-Assistant Schools Division Superintendent Victor M. Javeña EdD Chief, School Governance and Operations Division and Manuel A. Laguerta EdD Chief, Curriculum Implementation Division Education Program Supervisors Librada L. Agon EdD (EPP/TLE/TVL/TVE) Liza A. Alvarez (Science/STEM/SSP) Bernard R. Balitao (AP/HUMSS) Joselito E. Calios (English/SPFL/GAS) Norlyn D. Conde EdD (MAPEH/SPA/SPS/HOPE/A&D/Sports) Wilma Q. Del Rosario (LRMS/ADM) Ma. Teresita E. Herrera EdD (Filipino/GAS/Piling Larang) Perlita M. Ignacio PhD (EsP) Dulce O. Santos PhD (Kindergarten/MTB-MLE) Teresita P. Tagulao EdD (Mathematics/ABM) For the learner: Welcome to Fundamentals of Accountancy, Business and Management 1 Quarter 2 Self Learning Module on Preparing of Post-Closing Trial Balance! This module was designed to provide you with fun and meaningful opportunities for guided and independent learning at your own pace and time. You will be enabled to process the contents of the learning material while being an active learner. This module has the following parts and corresponding icons: Expectations - This points to the set of knowledge and skills that you will learn after completing the module. Pretest - This measures your prior knowledge about the lesson at hand. Recap - This part of the module provides a review of concepts and skills that you already know about a previous lesson. Lesson - This section discusses the topic in the module. Activities - This is a set of activities that you need to perform. Wrap-Up - This section summarizes the concepts and application of the lesson. Valuing - This part integrates a desirable moral value in the lesson. Posttest - This measure how much you have learned from the entire module. After going through this module, you are expected to: 1. define post-closing trial balance; 2. enumerate the accounts that are in the post-closing trial balance; 3. prepare a post-closing trial balance; and 4. understand and appreciate the usefulness of post-closing trial balance. Directions: Write the correct letter of your answer on the space provided. _____1. The purpose of the post-closing trial balance is to a. aid the journalizing and posting of the closing entries. b. Ensure that the ledger is in balance for completion of the worksheet. c. Ensure that the ledger is in balance for the start of the next period. d. Provide the account balances for the preparation of the balance sheet. _____2. Post-closing trial balance differ is for the adjusted trial balance in that it does not a. Include balance sheet accounts. b. Include income statement accounts c. Take into account adjusting entries d. Take into account closing entries _____3. The post-closing trial balance would not include which of the following accounts? a. Accounts Payable b. Allowance for Doubtful Accounts c. Owner’s Drawing d. Unearned Rent Income For numbers 4-5 Write true if the statement is correct. If it is false write the correct word or phrases to make the statement correct. _____ 4. After adjustments and closing entries are made, post-closing trial balance is prepared to test the equality of the accounts. _____ 5. Nominal accounts are accounts that reflected in the post-closing trial balance. EXPECTATIONS PRETEST Directions: Fill in the blanks. 1. ____________________ are entries prepared at the end of the accounting period to bring the balances of the temporary or nominal accounts to zero. A clearing account called 2._________________ is used. The revenue account such as Rent Income which has a normal credit balance should be closed on the 3.____________ side and 4.__________________ to the Income Summary Account. The 5.___________________account which normally is a debit balance is credited to close and debited to the capital account to bring a reduction. After closing entries are prepared and posted, posting closing trial balance is the next step. This is the 9th step in the accounting cycle. Errors may be committed in preparing the adjustments and closing entries; hence, it is required to test the equality of the accounts by preparing a new trial balance which is the post-closing trial balance. ➢ Post-closing trial balance verifies that the debits and credits are equaled. ➢ Post-closing trial balance contains only real accounts or balance sheet accounts such as assets, liabilities and ending capital because nominal accounts are closed. LESSON RECAP Cash on Hand 25 0 0 0 - Cash in Bank 45 0 0 0 - Accounts Receivable 49 0 0 0 - Allow. for Doubtful Accounts 4 9 0 0 - Prepaid Supplies 2 0 0 - Interest Receivable 4 5 0 - Notes Receivable 30 0 0 0 - Delivery Fees Earned 5 0 0 0 - Machinery and Equipment 150 0 0 0 - Accumulated Deprn.-Machi & Equipt. 7 5 0 0 - Furniture and Fixtures 25 0 0 0 - Accumulated Deprn.-Furnitures & Fix. 2 2 5 0 - Interest Payable 7 5 0 - Taxes and Licenses Payable 1 3 0 - Accounts Payable 26 0 0 0 - Notes Payable 50 0 0 0 - Carlito, Capital 238 1 2 0 - Total 329 6 5 0 - 329 6 5 0 - Carlito Auto Repair Shop Post-Closing Trial Balance December 31, 2019 U N A D JU ST ED T R IA L B A LA N C E D R C R D R C R D R C R D R C R D R C R C a sh 1 2 6 ,8 0 0 1 2 6 ,8 0 0 1 2 6 ,8 0 0 A cc o u n ts R ec ei va b le 2 8 ,2 0 0 1 0 ,0 0 0 3 8 ,2 0 0 3 8 ,2 0 0 Su p p li es 1 7 ,8 0 0 5 ,4 0 0 1 2 ,4 0 0 1 2 ,4 0 0 P re p a id I n su ra n ce 3 8 ,0 0 0 1 2 ,0 0 0 2 6 ,0 0 0 2 6 ,0 0 0 La n d 9 6 0 ,0 0 0 9 6 0 ,0 0 0 9 6 0 ,0 0 0 B u il d in gs 1 ,6 4 0 ,0 0 0 1 ,6 4 0 ,0 0 0 1 ,6 4 0 ,0 0 0 A cc u m . D ep re ci a ti o n - b u il d in gs 3 7 9 ,2 0 0 1 0 ,0 0 0 3 8 9 ,2 0 0 3 8 9 ,2 0 0 Eq u ip m en t 1 ,0 6 0 ,0 0 0 1 ,0 6 0 ,0 0 0 1 ,0 6 0 ,0 0 0 A cc u m . D ep re ci a ti o n - e q u ip m en t 3 3 6 ,0 0 0 1 8 ,0 0 0 3 5 4 ,0 0 0 3 5 4 ,0 0 0 A cc o u n ts P a ya b le 4 3 ,2 0 0 4 3 ,2 0 0 4 3 ,2 0 0 U n ea rn ed D el iv er y Fe es 4 2 ,0 0 0 1 6 ,0 0 0 2 6 ,0 0 0 2 6 ,0 0 0 M o rt ga ge P a ya b le 1 ,1 6 0 ,0 0 0 1 ,1 6 0 ,0 0 0 1 ,1 6 0 ,0 0 0 B ea u ty , C a p it a l 1 ,4 3 2 ,6 0 0 1 ,4 3 2 ,6 0 0 1 ,4 3 2 ,6 0 0 D el iv er y Fe es E a rn ed 6 6 9 ,2 0 0 1 6 ,0 0 0 6 9 5 ,2 0 0 6 9 5 ,2 0 0 1 0 ,0 0 0 Sa la ry E xp en se 1 7 3 ,4 0 0 3 ,6 0 0 1 7 7 ,0 0 0 1 7 7 ,0 0 0 Te le p h o n e Ex p en se 2 ,4 0 0 2 ,4 0 0 2 ,4 0 0 U ti li ti es E xp en se 7 ,0 0 0 7 ,0 0 0 7 ,0 0 0 R ep a ir s Ex p en se 8 ,6 0 0 8 ,6 0 0 8 ,6 0 0 T o ta l 4 ,0 6 2 ,2 0 0 4 ,0 6 2 ,2 0 0 Su p p li es E xp en se 5 ,4 0 0 5 ,4 0 0 5 ,4 0 0 In su ra n ce E xp en se 1 2 ,0 0 0 1 2 ,0 0 0 1 2 ,0 0 0 D ep re ci a ti o n E xp en se - B u il d in g 1 0 ,0 0 0 1 0 ,0 0 0 1 0 ,0 0 0 D ep re ci a ti o n E xp en se - E q u ip m en t 1 8 ,0 0 0 1 8 ,0 0 0 1 8 ,0 0 0 Sa la ry P a ya b le 3 ,6 0 0 3 ,6 0 0 3 ,6 0 0 In te re st E xp en se 4 ,2 0 0 4 ,2 0 0 4 ,2 0 0 In te re st P a ya b le 4 ,2 0 0 4 ,2 0 0 4 ,2 0 0 To ta l 7 9 ,2 0 0 7 9 ,2 0 0 4 ,1 0 8 ,0 0 0 4 ,1 0 8 ,0 0 0 2 4 4 ,6 0 0 6 9 5 ,2 0 0 3 ,8 6 3 ,4 0 0 3 ,4 1 2 ,8 0 0 N et I n co m e - 4 5 0 ,6 0 0 4 5 0 ,6 0 0 To ta l 6 9 5 ,2 0 0 6 9 5 ,2 0 0 3 ,8 6 3 ,4 0 0 3 ,8 6 3 ,4 0 0 B EA U TY D EL IV ER Y SE R V IC ES W O R K SH EE T D ec em b er 3 1 , 2 0 1 9 A C C O U N TS A D JU ST M EN TS A D JU ST ED T R IA L B A LA N C E IN C O M E ST A TE M EN T B A LA N C E SH EE T Activity 2 Prepare the post-closing trial balance This the worksheet of the Beauty Delivery Services. Prepare the post-closing trial balance. To summarize what you have learned from the lesson, answer the following questions: 1. define post-closing trial balance; 2. what are the accounts found in post-closing trial balance; and 3. why it is important to prepare the post-closing trial balance? ➢ What are your main takeaways in today’s lesson? ➢ Reflect on the significance of vertical analyses of financial statements. Directions: Identify each item below. Write your answer before the item number. _____1. The entry to close the withdrawal account is a. Debit Income Summary and credit Owner’s Withdrawal b. Debit Owner’s Capital and credit Owner’s Withdrawal c. Debit Owner’s Withdrawal and credit Income Summary d. Debit Owner’s Withdrawal and credit Owner’s Capital _____ 2. The purpose of the closing entries is to a. Bring the temporary accounts to zero b. Bring the permanent accounts to zero c. Update the temporary accounts d. Update the permanent accounts _____ 3. A clearing account used only at the end of the accounting period to summarize revenues and expenses for the period a. Asset Summary b. Capital Summary c. Expense summary d. Income summary For numbers 4-5 Write TRUE if the statement is correct. If it false write the correct word or phrase to make the statement true. _____4. The closing entry for Rent Expense, with a balance of P24,000 is debit Rent Expense for 24,000 and credit Income Summary for P24,000. _____ 5. All nominal accounts need to be closed. WRAP-UP VALUING POSTTEST References Ballada, W. 2017. Fundamentals of Accountancy, Business, and Management 1. VDomDane Publishers. Banggawan, RB. Asuncion, DJ. 2017. Fundamentals of Accountancy, Business, and Management 1. Real Excellence Publishing. Ferrer, RC. Millan, CV. 2017. Fundamentals of Accountancy, Business, and Management 1. Bandolin Enterprise. San Juan, DA. 2018. Fundamentals of Accounting. Elmoer Publishing Rabo, JS. Tugas,FC.Salendrez, HE. 2016. Fundamentals of Accountancy, Business, and Management 1. Vibal Group Inc. Manuel, Zenaida Vera-Cruz 18th Edition Accounting Process_Basic Concepts and Procedures Epstein, Lita, MBA Bookkeeping Workbook for Dummies. Wiley Publishing, Inc. Hernane, Milagros B.,et.al 2014. Principles of Accounting. Allen Adrian Books Inc. Valencia, Edwin G. 4th Edition. Basic Accounting (Concepts, Principles, Procedures and Applications) . Valencia Educational Supply KEY TO CORRECTION PRETEST: 1.C 2.A 3.C 4.TRUE 5.REAL ACCOUNTS RECAP: 1.Closing entries 2.Income Summary 3.Debit 4.Credited 5.Drawing POSTTEST 1.B 2.A 3.D 4.Dr. Income Summary 24,000 Cr. Rent Expense 24,000 5.TRUE