Villa Consultant Company€™s adjusted trial balance at the end of its fiscal year follows.

Required
1. Prepare the required closing entries.
2. Explain why closing entries are necessary at the end of the accountingperiod.

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Villa Consultant Company Adjusted Trial Balance December 31, 2014 Cash Accounts Receivable Prepaid Insurance Office Supplies Office Equipment Accumulated Depreciation-Office Equipment Automobile Accumulated Depreciation- Automobile Accounts Payable Unearned Consulting Fees J. Villa, Capital J. Villa, Withdrawals Consulting Fees Earned Office Salaries Expense Advertising Expense Rent Expense Telephone Expense Depreciation Expense-Office Equipment Depreciation Expense Automobile 14,550 4,650 1,170 880 12,600 1,530 13,500 1,500 3,400 3,000 29,070 14,000 66,430 27,000 5,050 5,300 3,200 1,530 1,500 104,930 104,930