Spicer Inc. showed the following alphabetized list of adjusted account balances

Question

Spicer Inc. showed the following alphabetized list of adjusted account balances at December 31, 2017:

The company uses an income summary account in the closing process.


Required:
1. Assuming normal balances, prepare the closing entries at December 31, 2017, the company’s year-end. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)  

1

Record to close the revenue account to the income summary.

2

Record to close the expense accounts to the income summary.

3

Record to close the income summary to retained earnings.

4

Record to close the Cash Dividends account to Retained Earnings.

  Accounts Payable 26,660   Accounts Receivable 40,100   Accumulated depreciation, Equipment 11,090   Accumulated depreciation, Warehouse 22,180   Cash 9,300   Cash Dividends 20,500   Common Shares 121,000   Equipment 79,300   Income Tax Expense 41,500   Land 126,600   Notes Payable, due in 2020 34,500   Operating Expenses 110,100   Preferred Shares 40,100   Retained Earnings 28,620   Revenue 281,050   Warehouse 137,800 Post-Closing Balance in Retained Earnings: Retained Earnings, December 31, 2016 Retained Earnings, December 31, 2017

Explanation / Answer

Part 1)

The closing entries at December 31, 2017, the company’s year-end are provided as below:

_____

Part 2)

The post-closing balance in Retained Earnings at December 31, 2017 is deteremined as below:

Event Account Titles Debit Credit 1) Revenue $281,050 Income Summary $281,050 (To close revenue account to income summary) 2) Income Summary $151,600 Operating Expenses $110,100 Income Tax Expense $41,500 (To close expense accounts to income summary) 3) Income Summary (281,050 - 151,600) $129,450 Retained Earnings $129,450 (To close the income summary to retained earnings) 4) Retained Earnings $20,500 Dividends $20,500 (To close the cash dividends account to retained earnings)

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

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