Exercise 10.

1 Worked Solutions
To transfer revenues and expenses to the Profit & Loss Summary account so that profit can be calculated for the current period
To reset revenue and expense accounts to zero in preparation for the next period
 Date Details Debit $ Credit $
       

       

       

       

       

       
 Date Details Debit $ Credit $
       

       

       

       

       

       

       
 Date Details Debit $ Credit $
       

       

       
 Because inventory is a current asset and therefore it represents future economic benefits and its balance will be
carried forward to the next reporting period

The Profit and Loss Summary account is transferred to the capital account. It would be reported as part of
Owner’s Equity in the balance sheet