Closing journal entry
Closing journal entry is a journal entry that is prepared to (a) reset all temporary accounts to a zero balance and (b) update Owner's Capital to a new balance.
Definitions
According to College Accounting: A Practical Approach by Slater (13th edition),
- Closing journal entry. A journal entry that is prepared to (a) reset all temporary accounts to a zero balance and (b) update Owner's Capital to a new balance.
Related concepts
- Accounting (alternatively known as accountancy) is management of financial data, information, and knowledge about financial transactions of legal entities. Accountancy tends to include bookkeeping and, depending on a particilar enterprise, may also include quatitative analysis of financial data in the bookkeeping system and/or business intelligence.
