Chapter 4 (Continued): Completing the Accounting Cycle

A. Once you have graduated from your attending college and successfully completing and pass the Uniform Certified Public Accountant test, you decided to open an accounting firm which conducts business in several fields, such as tax filling, financial consulting. Not long after that a new client decides to enlist your services, she is very nervous and anxious regarding her expenses. She thinks that her accounting services are kind of high in pricing and feels that she might be able to save some money by directing her accounting personnel to not doing closing entries.

- Please mention how you will explain your client the importance of doing closing entries and what are the pros or benefits to her business of doing so.

- Explain what are permanent or temporary accounts. while also explaining in which financial statement are located the permanent accounts and also temporary accounts.

- Give 3 examples of the two types of closing entries.