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17 April, 00:58

After the accounts were adjusted at January 31, 2010, the end of the fiscal year, the following balances were taken from the ledger of Taylor Pool Service Company:Capital Stock $ 20,000Retained Earnings 115,000Dividends 5,000Fees Earned 116,400Wages Expense 29,000Rent Expense 43,000Supplies Expense 7,300Miscellaneous Expense 1,750Journalize the four entries required to close the accounts.

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  1. 17 April, 02:01
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    fees earned 116,400 debit

    income summary 116,400 credit

    --to close revenues account--

    Income summary 81,050 debit

    Wages Expense 29,000 credit

    Rent Expense 43,000 credit

    Supplies Expense 7,300 credit

    Miscellaneous Expense 1,750 credit

    - - to close expenses accounts--

    Income summary 5,000 debit

    Dividends 5,000 credit

    - - to close dividends accounts--

    Income summary 30,350 debit

    Dividends 30,500 credit

    - - to close income summary account--

    Explanation:

    on accounting we close the temporary accounts which are: revenues expenses dividends

    To do so, we will use an auxiliary account called income summary.

    Once we close this we calculate the blaance of income summary using a T-account:

    income summary

    debit credit

    81,050 116,400

    5,000

    Balance: 30.350‬

    And close it as well against retained earnings
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