What happens after all the closing entries have been posted to the general ledger?
submitted by Felix Austead

Francis

Once the closing entries are done, the temporary accounts are cleared out, so they start fresh next period. The permanent accounts (assets and liabilities), keep their balances.

Hermie

When you finish posting all those closing entries, you end up with a clean slate for the next period. The revenues and expenses are moved over to retained earnings, so the accounts are all set for the next batch of transactions.

Duwayne

After all the closing entries are posted, the accounts are reset to zero. This means you're starting at zero at the beginning of the next accounting period. Temporary accounts like revenues and expenses are closed out to retained earnings. The only accounts that carry forward are the permanent accounts.