Question

Given the following adjusted trial balance, what will be the totals for the debit and credit columns of the post-closing trial balance?

	Debit		Credit
Cash	$897
Accounts receivable	1133
Inventory	1687
Prepaid rent	46
Equipment	160
Accumulated depreciation-equipment			$28
Accounts payable			44
Unearned service revenue			93
Common stock			112
Retained earnings			3570
Service revenue			172
Interest revenue			30
Salaries and wages expense	90
Travel expense	36
Total	$4049		$4049

A) $3895

B) $4049

C) $4021

D) $3923

Answer 1

Before Preparing Post Closing Trial Balance we need to prepare Income Statement Statement of Retained Earnings and Closing Entries to close Temporary Accounts, because Post Closing Trial Balance look like Balance Sheet, it is Permanent Accounts like Balance Sheet.

Income Statement

For the Year Ended

Accounts	Amount	Amount
Revenues:-
Service Revenue	$172
Interest Revenue	30
Total Revenues		$202
Less:- Expenses
Salaries and Wages Expense	$90
Travel Expense	36
Total Expenses		$(126)
Net Income		$76

Statement of Retained Earnings

Accounts	Amount
Retained Earnings	$3,570
Add:- Net Income	76
Retained Earnings, Ending	$3,646

Preparing Closing Entries to close Temporary Accounts:-

General Journal

At the end of Year

Accounts	Debit	Credit
Service Revenue	$172
Interest Revenue	$30
Income Summary		$202
(To close Revenue Accounts)
Income Summary	$126
Salaries and Wages Expense		$90
Travel Expense		$36
(To close Expenses Accounts)
Income Summary	$76
Retained Earnings		$76
(To close Income Summary)

Post Closing Trial Balance

As on

Accounts Title	Debit	Credit
Cash	$897
Accounts Receivable	1,133
Inventory	1,687
Prepaid Rent	46
Equipment	160
Accumulated Depreciation, Equipment		$28
Accounts Payable		44
Unearned Service Revenue		93
Common Stock		112
Retained Earnings, Ending		3,646
Totals	$3,923	$3,923

So the totals for the Debit and Credit columns of the Post Closing Trial Balance is $3,923.

So the Answer is Option (D) $3,923.