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if you remember from last time those temporary accounts are our read accounts which are revenue accounts expenses and dividends so how are we going to get rid of these balances because that's what we need to do for these temporary accounts well what we're going to do is for instance if we have we have five thousand dollars of revenue and you kind of remember that revenue does have a credit balance well what we're
going to do in order to bring this balance down to zero is we're going to do the opposite by debiting revenue by five thousand dollars that way we're going to have a final balance of zero and our temporary account will be zeroed out so that's exactly what we're going to do in this tutorial we're going to clear those temporary account balances and transfer them to a permanent account which you know now is retained
earnings so let's get on that and I actually created some balances for this this presentation I have an income statement with revenues expenses and I actually do want to put up that dividends for this tutorial are going to be one thousand dollars let me just put that up here at the top dividends are one thousand all right so how are we going to actually close out these accounts well we're going to do them
in a specific order we're going to first close out revenues secondly we'll close out expenses and then we're going to close out our our last temporary account which is dividends last so let's do this let's start with revenues so revenues have...
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