Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $196,000,

Question

Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $196,000, expenses of $109,200, and withdrew $22,400 from the business during the current year. The owner’s capital account before closing had a balance of $308,000. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is:

Multiple Choice

Debit T. Westmont, Capital $308,000; credit Income Summary $308,000

Debit T. Westmont, Capital $64,400; credit Income Summary $64,400

Debit Income Summary $64,400; credit T. Westmont, Capital $64,400

Debit Income Summary $86,800, credit T. Westmont, Capital $86,800

Debit T. Westmont, Capital $86,800, credit Income Summary $86,800

Explanation / Answer

Entry to close income summary account :

so answer is d) Debit Income Summary $86,800, credit T. Westmont, Capital $86,800

date accounts & explanation debit credit Income summary a/c (196000-109200) 86800 Westmont, capital a/c 86800 (To record close of income summary account)

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.