Question

Which step is taken at the end of the accounting period?

1) analyze source documents
2) prepare a post-closing trial balance
3) post to the general ledger accounts
4) prepare a trial balance

Answer 1

The step taken at the end of the accounting period is to prepare a post-closing trial balance, which confirms that all temporary accounts have been closed and the ledger is ready for the new period.

Step-by-step explanation:

At the end of the accounting period, the step that is taken is to prepare a post-closing trial balance. This step occurs after the company has journalized and posted all closing entries to reset the balances of temporary accounts to zero and to transfer their balances to permanent accounts. Preparing a post-closing trial balance ensures all temporary accounts have been closed and the general ledger is in balance for the start of the new accounting period. It's the last step in the accounting cycle after which the company can start a new accounting period with zeroed-out revenues, expenses, dividends, and withdrawal accounts.