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Please complete both parts.

Part I

(1) What are the steps in the accounting cycle and why do they have to be done in order?

(2) Is it ever a good idea to skip any of the steps? Please explain.

Part II

(1) What is a temporary account and which specific accounts or types of accounts are considered temporary?

(2) Is "Owner's Capital" a temporary or permanent account? Please explain what happens to this account during the closing process.

(3) Please post both journal entries for the 2-Step closing process using ONE of the scenarios below. If needed, please review the examples in Chapter 4 for guidance.

Please indicate which scenario you are answering and include the date for each. Assume the period ends December 31 for either scenario.

Scenario A	Scenario B
Cash $10,100 Accounts Receivable $7,300 Accounts Payable $1,172 A.A., Capital $14,300 A.A., Drawing $2,500 Service Revenue $5,816 Rental Revenue $3,082 Rent Expense $2,404 Wages Expense $1,603 Utilities Expense $401 Miscellaneous Expense $62	Cash $616,000 Accounts Receivable $444,750 Accounts Payable $249,450 B.B., Capital $880,000 B.B., Drawing $11,000 Fees Earned (Revenue) $520,400 Wages Expense $488,000 Rent Expense $65,000 Supplies Expense $11,200 Miscellaneous Expense $13,900

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