Palmer Company is at the end of its annual accounting period.The accountant has journalized and posted all external transactions and all adjusting entries,has prepared an adjusted trial balance,and completed the financial statements.The next step in the accounting cycle is:
A)Prepare a work sheet.
B)Prepare reversing entries.
C)Close temporary accounts.
D)Prepare a post-closing trial balance.
E)Prepare an unadjusted trial balance.

Question

Quizplus · Accepted Answer

Closing temporary accounts is the next step after preparing financial statements in the accounting cycle. This involves transferring the balances of all temporary accounts (revenues, expenses, and dividends) to the retained earnings account to prepare the accounts for the next accounting period.

Palmer Company Is at the End of Its Annual Accounting