Start by inserting the beginning balances in the T-accounts from the Year 0 Balance Sheet and then post your journal entries from the General Journal. Next, calculate the ending balance in each account. Then, prepare Year 1 financial statements based on the ending balances in each T-account. Finally, go back to the General Journal and prepare closing entries. Post your closing entries to the General Ledger T-accounts. Finally, prepare a Post-Closing Trial Balance.

Adomain Income Statement
for Year ended December 31, Year 0
Revenues
Sales Revenue	$146,500
Expenses
Cost of Goods Sold	(62,500)
R & D Expense	(9,100)
Sales Commissions	(3,000)
Marketing Expense	(9,000)
Rent Expense	(5,700)
Other Operating Expenses	(23,000)
Income from Operations	$34,200
Interest Income	400
Income before Taxes	34,600
Income Tax Expense	(8,500)
Net Income	26,100

Adomain Balance Sheet
As of December 31, Year 0
Assets
Cash	$80,000
Marketable Securities	6,700
Accounts Receivable	20,000
Inventory	25,000
PP&E (net)	34,700
Intangible Assets	10,500
Other Long-Term Assets	15,000
Total Assets	$191,900
Liabilities & Equity
Accounts Payable	$45,000
Notes Payable*	28,500
Unearned Revenue	50,000
Income Tax Payable	4,300
Common Stock	45,000
Retained Earnings	19,100
Total Liabilities & Equity	$191,900
*Assume these notes represent non-interest-bearing loans from owners, due in 5 years .

  
 

Post-Closing Trial Balance DR CR Total