Problem 3-6A Record closing entries and prepare a post-closing trial balance (LO

Question

Problem 3-6A Record closing entries and prepare a post-closing trial balance (LO6, 7) The following information applies to the questions displayed below.] The year-end financial statements of Rattlers Tax Services are provided below RATTLERS TAX SERVICES ncome Statement Service revenue $70,000 Expenses: Salaries Utilities $44,500 6700 4,300 1,35056,850 Insurance Supplies Net income $ 13,150 RATTLERS TAX SERVICES Statement of Stockholders' Equity Retained Earnings Stockholders' Equity $23,000 Common Total Stock $45,000 15,000 Beginning balance, Jan. Issue stock Net income Dividends $68,000 15,000 13,150 (4,500) 13,150 (4,500) Ending balance, Dec. 31 $60,000 31,650 $ 91,650

Explanation / Answer

Answer 1. Rattlers Tax Service Journal Entry Date Particulars Dr. Amt. Cr. Amt Dec. 31 Income Statement                                    Dr. 56850    To Salaries Exp. 44500    To Utilities 6700    To Insurance 4300    To Supplies 1350 (All the expenses accounts are transferred to Income Statement) Dec. 31 Service Revenue                                       Dr. 70000    To Income Statement 70000 (Service revenue is transferred to Income statement) Dec. 31 Income Statement                                   Dr. 13150    To Retained Earnings 13150 (profit earned during the year) Answer 2. Rattlers Tax Service Post Closing Trial Balance For the period ended Dec 31 Particulars Dr. Amt. Cr. Amt Common Stock          60,000 Retained Earnings          31,650 Cash            3,200 Accounts Receivables            5,700 Land          90,000 Accounts Payables            7,250 Total          98,900          98,900

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