Closing entries transfer revenue and expense balances to the retained earnings account. This process resets the temporary account balances to zero for the new accounting period. Recording closing ...

At the end of an accounting period, certain accounts are closed so they have a zero balance at the beginning of the new accounting period. The act of zeroing these accounts is called closing entries.

Accountants train for many years to avoid making fundamental mistakes such as missing journal entries. Closing entries are journal entries that move balances from temporary income and expense accounts ...