Upon your review, you observed that Midtown analyzed transactions in preparation for journals,… 1 answer below »

The spreadsheets can be found in the attached file.

The worksheet and financials for Midtown Repair Company at December 31, 20XX are provided below.
Use the worksheet and financial statements provided to complete the requirements.


1. Upon your review, you observed that Midtown analyzed transactions in preparation for journals, recorded journal entries, posted journal entries to the general ledger, and prepared an unadjusted trial balance. What are the next two required steps in the accounting cycle for Midtown? Provide the name of each step and describe what actions take place during each step.

a. You reviewed the financial statements provided by Midtown and observed that the file of closing entries cannot be located. Using the worksheet provided below, prepare the closing entries for Midtown.

b. Be sure to include a description for each entry.

2. Prepare the revenue and expense accounts post-closing ledger (to close revenues and expenses to Income Summary).

The capital ledger accounts and post-closing entries are provided above:

1. Where will the final capital balance of $163,600 be reported?

a. What does the final capital balance of $163,600 reflect? Explain.

2. A partialbalance sheet was provided by Midtown for your review (see balance sheet below).

a. What components are missing from the balance sheet? Why are they required? Explain.

b. Complete the balance sheet for Midtown. Add the required information to the table provided below.

c. On the balance sheet, which 2 accounts must equal the same amount? Why? Explain.

3. You observed that a Post-Closing Trial Balance was not prepared. Why is this step in the accounting cycle important? Explain.

a. Prepare the Post-Closing Trial Balance for Midtown. Use the template provided below (Check figure for debit/credit totals = $335,600)

Why doesn’t the totals on the balance sheet equal the totals on the post-closing trial balance?


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