1. (TCO 3) At the end of the period it is necessary to close all temporary accounts. (1) Explain why this process is required (10 points) and (2) provide an example of the closing of an expense account, Salary Expense in the form of a journal entry. (10 points) (Points : 20)
1. We have to close temporary accounts at the end of a period because when the temporary accounts are closed, it brings their balances back down to zero. 2. I would Debit Salary Expense and Credit to PayrollExpenses 12/31 DR Salary Expense 1000 Cr Payroll 1000 |

2. (TCO 2) As required to complete Course Project 1, one must follow the cycle that includes 10 steps to complete the accounting cycle. (1) Explain how the debit/credit rules are used when developing journal entries (10 points) and (2) provide an example of the application of the debit/credit rules in the form of a journal entry. (10 points)(Points : 20)
1. In accounting, a debit increases the balance and a credit decreases the balance. The accounts that have a normal debit balance are assets, the owner's equity, expenses and losses. Normal credit balances are liabilities, equity, revenue, and gains. When we debit an account, we raise the balance. When we credit the account, we decrease the balance. Using a double entry system, we would debit one account and credit the other to get the journal in balance.2. An example would be debit rent expense and credit bank account.DR Rent Expense 3000CR Checking 3000To record rent expense for the month of Jan. |

3. (TCO 5) Internal Control Procedures are required to safeguard company assets and to ensure ethical operation of the business. (1) Explain how limited access can satisfy the purpose of internal control (10 points) and (2) provide an example of how this control could be implemented. (10 points) (Points : 20) 1. To