Following are selected accounts and their balances for a company after the adjus
ID: 2376249 • Letter: F
Question
Following are selected accounts and their balances for a company after the adjustments as of May 31, the end of its fiscal year. (All accounts have normal balances.)
J.Mark, Capital........... $30,000
J.Mark, Withdrawals.... $6,000
Fees earned.............. $20,000
Salaries expense......... $7,000
Insurance expense....... $350
Utilities expense......... $75
Supplies expense......... $500
Supplies.................... $400
Salaries payable........... $300
Depreciation expense.... $425
Prepare all the necessary closing entries for this company. SHOW ALL WORK!!!!
Please Help!!
Explanation / Answer
Dr fees earned $2000
Cr Income summary 2,000
to close off revenue accounts
Dr Income summary 8,350
Cr salaries expense........$7000
Cr insurance expense.....$350
Cr utilities expense.........$75
Cr supplies expense.......$500
Cr depreciation expense..$425
to close off expense accounts
Dr j mark capital $6,350
Cr Income summary $6,350
to close off income summary account
Dr j mark capital.............$6000
Cr j mark withdrawals......$6000
to close off withdrawals account
Since there is a personal Capital account and Drawing account, this business is asole proprietorship not a corporation, so there is no Retained Earnings Account. Instead, the J. Mark, Capital is used.
So your last two entries should be;
Dr Income summary 21,650
Cr J. Mark, Capital 21,650
Dr J. Mark, Capital 6,000
Cr J. Mark, Drawing 6,000
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