Accounting Cycle Step 9: Post-Closing Trial Balance (Sole Proprietorship)


Preparing the post-closing trial balance is the 9th step in the accounting cycle. This is also an optional step. It is prepared after the closing journal entries and its purpose is to verify that the temporary accounts have been enclosed. Let’s remember that the trial balance lists accounts in the following order: assets; liabilities; equities; revenues; and expenses. Since the temporary accounts have been closed, the post-closing trial balance only lists the balance sheet accounts. Here is an example of a post-closing trial balance. Notice it includes our asset accounts, liability accounts, and balance sheet equity account – owner’s capital. Now you can see those accounts match up with what is reported on our balance sheet. And that concludes this video on the post-closing trial balance as well as our indepth study of the accounting cycle.

1 thought on “Accounting Cycle Step 9: Post-Closing Trial Balance (Sole Proprietorship)

  1. Thank you for imparting your knowledge with us. I hope I'll make it, to be a CPA! ❤ I loved it, the way things are explained, it is just simple but precise.

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