After all of the above closing entries are posted, and this is done as at the close of business June 30, 1922, the profit and loss account appears as follows:

Profit & Loss

Debit

Credit

$ 5,000

$ 500

6,000

1,000

19,000

6,000

Goes to undi vided profits account ....

3,000

500

19,000

$30,000

$30,000

Closing The Profit & Loss Account. - The entries required to close the balance of the profit and loss account into the undivided profits account are as follows:

Debit: Profit & Loss..............

.$19,000

Credit: Undivided Profits (27)...

.

$19,000

The posting of these entries reduces the balance of the profit and loss account to zero as shown above; and it increases the credit balance of the undivided profits account shown in the trial balance from $10,600 to $29,600 and this is the point of contact with the statement of assets and liabilities which will be shown subsequently.