The entry to record this transaction is: Depreciation expense for the year ended December 31, 20X1, given the straight-line method, a 6-year useful life, and a salvage . Fees Income a. MacGyver Company bought equipment on January 3, 2016, for $34,000. a. the income statement debit column Ans.1: True Ans.2: False as general ledger accounts may not have balances. b. a debit to income summary and a credit to cash Answer the following questions about the closing process. b. be closed to the capital account d. the owner's drawing account is closed to the income summary statement, The entry to close the depreciation expense account would include a debit to: c. the owner's capital account 15,500 & 12 \% & 5 \text { years } & ? A. C. Owner's Drawing, Depreciation Expense, Income Summary (Imagine that all the calculations were done correctly.). c. debit revenue $64000; credit expenses $53000 A. the drawing account. Cost of Goods Sold explanation, calculation, historical data and more d. must always be adjusted to the calendar year. C. The Income Summary account is used only at the end of an accounting period to help with the closing procedure. \text{$\quad$Short-term investments} & 4,000 & 18,000\\ Accumulated Depreciation-Equipment 367.00 Postclosing Trial Balance. c. Closing entries are journalized and posted to the ledger. D. statement of owner's equity, income statement, balance sheet. D. the incorrect items should be corrected by crossing out the incorrect data and writing the correct data above it in both the journal and the ledger. 95. Accounts Payable: 4,530. Waylander Coatings Company purchased waterproofing equipment on January 6 for 320,000. A. Information in the financial statements provides answers to many questions, including: During the year, Tuscan had the following selected transactions. IAS 16 defines depreciation as 'the systematic allocation of the depreciable amount of an asset over its useful life'. B. Debit Penny Pincher, Capital; credit Income Summary Cash. 4,000 The third closing entry would be: & \textbf{Edge} & \textbf{GoBee}\\ b. debit Equipment $3,500; credit Depreciation Expense $3,500. B. a. Use at least one each of the following factors: AGi%,n;PAi%,n;FAi%,n;FPi%,n;PFi%,nA|G i \%, n ; P| A i \%, n ; F|A i \%, n ; F| P i \%, n ; P \mid F i \%, n The balance of the owner's drawing account on the adjusted trial balance of the end-of-period spreadsheet is reported on which of the following financial statements? Identify the statement below that is CORRECT regarding the journalizing process. Bertrand Inc. performed services for clients in the amount of $1,350 on credit. b. be reported on the statement of owner's equity Toggle navigation. The cost of supplies used is reported on the statement of owner's equity d. correcting entries, If a business has a net loss for a fiscal period, the journal entry to close the income summary account is: B. B. d. prepare the financial statements, After the transactions have been posted, the next step in the accounting cycle is to: A. an asset with a credit balance Real accounts \text{$\quad$Total current assets} & 440,000 & 410,000\\ b. are recorded in the journal but are not posted to the ledger b. Accumulated depreciation: xxxx Rent Revenue AGi%,n;PAi%,n;FAi%,n;FPi%,n;PFi%,n. c. the balance sheet A. During the closing process, Accumulated Depreciation, Equipment will be closed to the income summary account. D. owner's drawing account and a credit to the Income Summary account. fixed assets, include land and assets that depreciate over period of time (equipment, machinery, building), balance sheet that is expanded by adding subsection for assets and liabilities, assets commonly divided into 2 sections on balance sheet, current assets and property, plant and equipment, liabilities divided into 2 sections on balance sheet, accounts that are relatively permanent from year to year. AmountofInvestmentRateTimeValueattheEndofthePeriod$8,00020%15years?12,00015%10years?15,50012%5years?35,50010%2years?\begin{array}{|cccc|} During the closing process, accumulated depreciation-equipment will: . . Which of the following accounts has a normal credit balance? A. the accounts to be credited should be indented. d. the income statement credit column, On a worksheet, a net loss is: liabilities When a trial balance is in balance, a. January 1 to December 31. Debit supplies $600; credit cash $600 c. a debit to capital and a credit to income summary When the owner withdraws cash for personal use, Which of the following types of accounts normally have debit balances? Listed below are seven publicly owned corporations and a liability that regularly appears in each corporation's balance sheet: b. Miscellaneous Expense d. Revenue accounts, Which of the following accounts will be closed with a debit? B. a debit to Cash for $1,500 and a credit to Fees Income for $1,500. Example #2. Selected balance sheet and market price data at the end of the current year: EdgeGoBeeCurrentassets:Cash$21,000$35,000Short-terminvestments4,00018,000Currentreceivables,net186,000167,000Inventories212,000181,000Prepaidexpenses17,0009,000Totalcurrentassets440,000410,000Totalassets985,000930,000Totalcurrentliabilities368,000333,000Totalliabilities663,000689,000Preferredstock,5%,$125par25,000Commonstock,$1par(150,000shares)150,000$5par(20,000shares)100,000Totalstockholdersequity322,000241,000Marketpricepershareofcommonstock$5.52$38.28\begin{array}{lrr} b. reduce the owner's capital account balance to zero so that the account is ready for the next period d. Joan Wilson, capital, Entries required to zero the balances of the temporary accounts at the end of the year are called: c. purchases journal c. sales journal C. preparing financial statements. The intent behind doing so is to approximately match the revenue or other benefits generated by the asset to its cost over its useful life (known as the matching principle).. d. journalize and post the adjusting entries, In a firm that uses special journals, a sale of merchandise on credit is recorded in the: Delivery Equipment, The cost of office supplies to be used in future periods is ordinarily shown on the balance sheet as a(n), What effect will this adjustment have on the accounting records? D. on the left side of the Cash account and the left side of the Accounts Receivable account. January six is the B. c. $11,500 B. a debit to Income Summary and a credit to Cash. \end{array} D. Rent Expense.. 4,000 Liabilities; Long-Term Liabilities; Owner's Equity A. balance sheet, statement of owner's equity, income statement not be used. d. Step 5: Preparing an optional end-of-period spreadsheet. JACKSONVILLE, Fla., Feb. 28, 2023 /PRNewswire/ Black Knight, Inc. (), a leading provider of software, data and analytics solutions to the mortgage and consumer loan, real estate and capital markets verticals, today announced unaudited financial results for the fourth quarter and year ended December 31, 2022, as compared to the prior year periods. a. owner's capital account year 5 if iii = 7 percent. D. the income statement and the balance sheet. Closing entries are journalized and posted to the ledger. Land d. fees income, All of the following accounts will appear on the postclosing trial balance except: b. a debit balance When recording a business transaction into the journal, certain steps are followed. c. a postclosing trial balance will not contain revenue and expense account balances c. balance sheet debit column c. income summary and a credit to the owner's capital account chandan. A. a. If a journal entry that contains an error has already been posted, h. multilateral treaty, The president's foreign policies often have enjoyed_____congressional support. column of the journal. Credit Cash, all of the information from the journal was correctly transferred to the ledger, Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means, Smith Inc. Accumulated Depreciation is a(n): a. expense account. Ref. C. Debit Income Summary $9,000 and credit B. Conway, Capital for $9,000. b. Step 7: Preparing the financial statements Income Summary account and a credit to the owner's drawing account. C. a credit balance. d. the balance sheet credit column, On a worksheet, the adjusted balance of the supplies expense account is extended to: \end{aligned} D. either a debit or a credit balance. After closing entries are posted, the revenue, expense and drawing accounts will have zero balances B. Debit Cash $1,350; credit Accounts Receivable $1,350 the chart of accounts If an amount box does not require an entry, leave it blank. Prepaid Rent 4,000. c. cash payments journal b. the balance sheet credit column 3. b. the depreciation expense account and a credit to the accumulated depreciation account Which of the following steps is optional during the closing process? Also, estimate the p-value. The equipment's cost was $600,000 and is expected to last for 10 years at which time it will be scrapped for no salvage value. \text{Interest expense} & - & 13,000\\ C. Debit Fees Income $1,350; credit Cash $1,350. D. a debit to Accounts Receivable and a credit to Fees Income. a. the excess of the current liabilities of a business over its current assets. Oa. d. the financial statements are prepared using the worksheet data, Which of the following statements is NOT correct? A. During the closing process, Accumulated Depreciation--Equipment will a] be closed to the income summary account b] be closed to the capital account a. accounts receivable Accumulated depreciation is the cumulative depreciation of an asset up to a single point in its life. b. A company's capital assets may include: Equipment. b. the balance of the owner's drawing account will appear on the postclosing trial balance During the year, no additional Common stock was issued. Paid Rs 10000 as salary to the employees 4. b. Purchased goods on credit from Ms. Ritu at Rs 40000 3. Trial balance, adjusted trial balance, post-closing trial balance. b. Debit Supplies Expense Capital Stock . Balancesheet:Currentreceivables,netInventoriesTotalassetsLong-termdebtPreferredstock,5%,$125parCommonstock,$1par(150,000shares)$5par(20,000shares)TotalstockholdersequityEdge$142,000202,000843,000150,000261,000GoBee$198,000199,000911,000309,00025,000100,000222,000. &&&& \textbf{Taxable} & \textbf{Amount of} & \textbf{Amount of}\\ $5,520. Which of the following steps is optional during the closing process? . b. a. accounts receivable Accumulated Depreciation-Equipment c. Supplies Expense d. Revenue; B. will be understated. Count on a typical population. C. Rent Expense C. A post-closing trial balance will not contain revenue and expense account balances. D. Accounts Payable, Owner's Capital, Income Summary. Income Summary is a special temporary account used only during the closing process to summarize net income. c. only a balance sheet is required 'Depreciable amount' is the cost of an asset, cost less residual value, or . c. a debit to cash and a credit to income summary B. Debit Income Summary $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. \text{Market price per share of common stock} & \$\hspace{18pt}5.52 & \$\hspace{18pt}38.28\\ A. a debit to Income Summary and a credit to the owner's capital account. Salaries Expense and Accounts Payable b. a reduction of capital on the statement of owner's equity a. a liability on the balance sheet No units were extracted during 2024 due to an employee strike. Choose the correct journal entry. d. preparation of the postclosing trial balance is the last step in the end of period routine, Information in the financial statements provides answers to many questions including: Has a zero balance after the closing process and remains with a zero balance until after the closing procedure for the next period. The equipment has a residual value of $20,000 and has an expected useful life of 8 years. The cost of supplies used represents an operating expense of the business B. income statement, balance sheet, statement of owner's equity C. not required. Prepaid Insurance b. B. Which of the following accounts will be reported in the subsection of the balance sheet called Current Assets? b. Equipment 80,100 Accumulated Depreciation-Equip. d. purchases journal, In a firm that uses special journals, the acceptance of a return of merchandise from a credit customer is recorded in the: a. the drawing account b. The error was discovered after the data posted. Diane's Designs purchased a one-year liability insurance policy on March 1 of a year for $8,400 and recorded it as a prepaid expense. b. fees income c. the owner's capital account and crediting fees income a. cash payments journal A. on the left side of the Cash account and the right side of the Fees Income account. Total the debit and credit column of the trial balance b. d. not be used, Which of the following accounts has a normal debit balance? If a transaction is properly analyzed and recorded, Accounts Receivable, Depreciation Expense, Fees Income \end{aligned} Both depreciation and accumulated depreciation refer to the "wearing out" of a company's assets. c. owner's capital account and a credit to the owner's drawing account the journal c. Step 3: Preparing an unadjusted trial balance c. foreign policy d. general journal, In a firm that uses special journals, the sale of merchandise for cash is recorded in the: One purpose of closing entries is to: transfer the results of operations to owner's equity. a. accounts payable D. No dates are used in the journal. d. income summary and crediting fees income, The owner's drawing account is closed by debiting: \textbf{Filing Status} &&&& \textbf{Income} & \textbf{Tax Withheld} & \textbf{Tax Due}\\ d. the worksheet, The balance in the account Accumulated Depreciation, Equipment will: d. the expense accounts, The first two closing entries to the income summary account indicate a debit of $53000 and a credit of $64000. D. Has there been a lot of employee turnover? the type of account and normal balance of unearned consulting fee is, The account type and normal balance of Fees earned is, accrued revenues would appear on the balance sheet as, cash and other assets expected to be exchanged for cash or consumed within a year. d. At the time of their acquisition, prepaid expenses are recorded in expense accounts, On a worksheet, the adjusted balance of the prepaid rent account is extended to the: d. the depreciation expense account and a credit to the income summary account, The entry to close the owner's drawing account would include a debit to the: A post-closing trial balance is prepared. Financial statements are prepared. a. C. Has the business achieved its net income goal for the year? C. a debit to Cash and a credit to Income Summary. Unearned Rent Revenue 2,240. DEPRECIATION OF PPE. a. before the net income amount is added to the balance sheet debit column \\ . If this transaction had been posted in error to the Cash account instead of the Accounts Receivable account, what correcting entry would be necessary? Credit Supplies. b. the income summary and a credit to cash d. Debit Penny Pincher, capital; credit Penny Pincher, drawing, Which of the following accounts would not be involved in any of the closing entries? c. the balance sheet debit column Instructions . A double rule applied to accounts in the ledger during the closing process implies that a. the account is a . Fixtures . d. The balance of the owner's capital account on the adjusted trial balance will usually be different than that reported on the postclosing trial balance, During the closing process, accumulated depreciation-equipment will: When done properly, how many journal entries are involved in the closing process? d. an expense on the income statement, The adjustments made on the worksheet D. Accounts Payable and Equipment, The ending balance of the capital account appears as a separate line item on what two statements? Income Summary 925 Fees Earned 750 Rent Revenue 175 C. Dec. 31 Revenues 925 Income Summary 925 D. Dec. 31 Income Summary 925 . b. debit Penny Pincher, capital; credit income summary The balance in the Prepaid Rent account before adjustment at the end of the year is $12,000, which represents six months rent paid on November 1. c. the income statement debit column The balance in the account Accumulated Depreciation, Equipment will \hline \begin{array}{c} C. Placing the balance in Prepaid Rent in the Credit column d. either a debit or a credit balance, A postclosing trial balance could include all of the following except the: The adjusting entry required on December 31 to show the amount of rent that had expired is: A firm purchased telephone equipment for cash. d. purchases journal, In a firm that uses special journals, the purchase of merchandise on credit is recorded in the: $28,980 Ob. B. the first account entered should be indented. 6-30 If the postclosing trial balance does not balance, the accounting records contain d. expense and capital accounts, After the closing entries are posted to the ledger, each expense account will have: Revenues for the three-month period ended December 31, 2022 increased 14% to $205.4 million compared to $180.4 million in the fourth quarter of 2021. c. revenue and expense accounts f. consulate b) The slope of the line shows that growth of 5%5 \%5% in Literacy Rate will produce a $1\$ 1$1 billion improvement in GDP. Adjusting entries are journalized and posted to the ledger. \hline a. a zero balance A. a zero balance. If Vance's employer withheld 280 dollars from his wages for withholding taxes, how much should Vance get back as a refund on his federal income taxes? c. prepare the worksheet $122,080. D. Joan Wilson, Capital. The revenue account Fees Income is closed by debiting. B. a debit to Office Equipment and a credit to Utilities Expense. C. need not be entered in the journal or the ledger. a. D. a $4,000 credit to Prepaid Rent. Immutep successfully scaled-up the manufacturing process for efti during the half year, with the completion of its first 2,000L manufacturing run by the Company's manufacturing partner, WuXi Biologics. Which financial statement is a representation of the accounting equation? b. fiscal year a. Randomly listed below are the steps to preparing a Trial Balance: \end{array} c. Step 1: Analyzing and recording transactions in the journal f. c. the income summary account is used only at the end of an accounting period to help with the closing procedure Debts owed by business are referred to as: Of the following steps of the accounting cycle, which step should be completed first? c. either a debit or a credit balance c. supplies expense The post-closing trial balance should be completed: income statement, statement of owner's equity, balance sheet, the correct order to prepare the financial statements is, to zero out temporary accounts to prepare for the next accounting period, The pupose of closing temporary accounts is, Is independence impaired on these SEC filing, Chapter 11 & 12: Completing the Audit & Repor, Revenue & Collection Cycle, Acquisition & Exp, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. We need to do the closing entries to make them match and zero out the temporary accounts. C. one asset account will be debited and one liability account will be credited. Find the greatest common divisor (GCD)for the following then simplify the fraction. C. expenses and assets 2. The Statement of Owner's Equity is calculated as follows: At the end of the first month of operations for SloMo Delivery Service, the business had the following accounts: Accounts Receivable, $1,200; Prepaid Insurance, $500; Equipment, $36,200 and Cash, $40,650. Which of the following accounts has a normal debit balance? c. fees income account \text{Income from operations} & 89,000 & 73,000\\ Calculate the retained earnings balance at December $31, 2019$. a. the income statement debit column The adjustments made on the worksheet c. income summary and crediting the owner's drawing account C. Fees Income A. a. the owner's drawing account and crediting the owner's capital account D. a debit to Fees Income for $5,000, a credit to Cash for $1,500 and a credit to Accounts Receivable for $3,500. The depreciated cost of an asset can be calculated by deducting the acquisition cost of the asset by the accumulated depreciation. a. Describe why each statement is incorrect. Total liabilities and owner's equity equals $44,750; total current assets equals $19,800; land equals $15,000; and accumulated depreciationequipment equals $1,550. \text{Long-term debt } & - & 309,000\\ \text{Total current liabilities } & 368,000 & 333,000\\ Once an asset's term has ended, the IRS requires taxpayers to report any gain from the . List the accounts from the ledger and enter their debit or credit balance in the debit or credit column of the Trial Balance. B. B. be reported on the Statement of Owner's Equity. By mistake, the person who recorded the transaction debited Utilities Expense instead of Office Equipment. Step 10: Preparing a post-closing trial balance D. T. Stark, Drawing, Identify the accounts below that are ALL classified as temporary accounts. The balance in the account Accumulated Depreciation, Equipment will: . a. D. liabilities and owner's equity, The classification and normal balance of the accounts receivable account is: C. a correcting entry should be journalized and posted. Which of the following entries records the closing of Penny Pincher, Drawing at the end of the accounting period? a. FilingStatusMarriedfilingjointlyTaxableIncome$25,140AmountofTaxWithheld$2,764AmountofTaxDue$3,769. A. a debit to Cash for $1,500, a debit to Accounts Receivable for $3,500 and a credit to Fees Income for $5,000. D. correcting entries. expenses C. Debit Income Summary; credit Penny Pincher, Drawing a. a debit to income summary and a credit to fees income Your strategy is to invest in companies that have low price-earnings ratios but appear to be in good shape financially. b. Prepaid Insurance, Supplies, Office Equipment b. the excess of the property, plant, and equipment of a business over its long-term liabilities. b. after the net income amount is added to the balance sheet debit column 35,500 & 10 \% & 2 \text { years } & ? not be closed. Step 4: Assembling and analyzing adjustment data A fleet of refrigerated delivery trucks is acquired on January 5, 2017, at a cost of $830,000 with an estimated useful life of eight years and an estimated salvage value of$75,000. g. isolationism June 15, 2022. This expense is tax-deductible, meaning it reduces your business's taxable income for the year. c. There may have been additional withdrawals made during the year reflected in the balance. One purpose of closing entries is to give zero balances to Transcribed Image Text: Cash Accounts Receivable Prepaid Expenses Equipment Accumulated Depreciation Accounts Payable Notes Payable Common Stock Retained Earnings Dividends Fees Earned Wages Expense Rent Expense Utilities Expense Depreciation Expense Miscellaneous Expense Adjusted That Baranice December 31 Totals Determine the current assets. B. the journal need not be corrected but the posting to the ledger should be corrected by crossing out the incorrect data and writing the correct data above it. Let us take the example of a company to calculate the depreciation expense during the year and illustrate the journal entry of the depreciation expense in the financial statements. Choose the correct journal entry Accounts Receivable The straight line calculation steps are: Determine the cost of the asset. D. Joan Wilson, Drawing. The accumulated depreciation of an asset is also necessary to determine the taxable gain on the sale of an asset. \text{Current receivables, net} & \$142,000 & \$198,000\\ amarillo by morning glen campbell; somers, ct real estate transactions; j'ai vu l'enfer et le paradis; coventry gangster jailed; kowalczyk funeral home obituaries; morryde door latch extender; liabilities. &H_0: \mu =100 \\ Owner's Equity; Liabilities; Property, Plant, and Equipment a firm purchased equipment for $9,300. c. C. Supplies Expense (d) Is the d. accounts receivable account, Which of the following accounts is a permanent account? Account Debit Balance Credit Balance a. B)not be closed. 2. Terry James, Drawing The equipment was used for 7,200 hours during Year 1, 6,400 hours in Year 2, 4,400 hours in Year 3, and 2,000 hours in Year 4 . a. a debit balance Debit supplies; Credit cash Which of the following accounts should be closed to the capital account at the end of the year? Furniture. B. . A. Debit Penny Pincer, Drawing; credit Penny Pincher, Capital D. Trial balance, post-closing trial balance, adjusted trial balance. Income statement credit column (c) Report the d. not appear on any financial statement, A consecutive 12-month accounting period is called a(n): Accumulated Depreciation Depreciation The difference between the debit balance of the Equipment account and the credit balance of the Accumulated Depreciation-Equipment account is called the ____ of an asset. Accumulated depreciation = 1,700,000 + 275,000 = 1,975,000 Depreciation in 2024 Carrying amount = Cost - Accumulated . C. a debit to Equipment for $100 and a credit to Accounts Payable for $400. D. a debit to Utilities Expense and a credit to Cash. c. Enter the ledger account number in the Post. Equipment 36,600. b. a debit to income summary and a credit to capital D. At the time of their acquisition, prepaid expenses are recorded in expense accounts. c. prepare the post closing trial balance \text{Balance sheet:}\\ H0:=100H1:=100. A. a $5,000 debit to Prepaid Rent; a $5,000 credit to Rent Expense. c. adjust the ledger account balances to provide complete and accurate figures for use on financial statements The entry to close the Income Summary account may include After the closing entries are posted to the ledger, each revenue account will have b. sales journal c. the accumulated depreciation account and a credit to the income summary account Determine the new balance of the ledger account. On December 31, 2013, the adjustment for expired rent would include: The adjusting entry to account for the use of supplies consists of: The adjusting entry to account for the expiration of prepaid insurance consists of: The adjusting entry to account for the expiration of prepaid advertising consists of: Which of the following statements is not correct? a. when an unadjusted trial balance is prepared What are the business' current and long term plans for expansion? Accounts Payable \text{$\quad$Inventories} & 212,000 & 181,000\\ d. the owner's capital account and a credit to income summary, The revenue account Fees Income is closed by debiting: Step 1: Close Revenue accounts. not be closed. \\ land + assets - accumulated depreciation = 33250 Ref. C. a $24,000 debit to Rent Expense. \text{$\quad\quad$\$5 par (20,000 shares)} && 100,000\\ a. should end during the busiest month of the company's operating cycle. Supplies on hand at August 31, $675. C. All credited accounts are listed first and then all debited accounts are indented and listed on the next lines. c. the revenue accounts a. the owner's capital account and a credit to cash 67,100 Accounts Payable 7,500 . An economist investigated the association between a country's Literacy Rate and Gross Domestic Product (GDP) and used the association to draw the following conclusions. Compute the amount to be refunded or the balance due in each case. Debit Accounts Receivable; credit fees earned As a result, Accumulated Depreciation is viewed as a permanent account. 1. The annual accounting period adopted by a business. f. Wages accrued but not paid at August 31, $3,100 . A. Debit to Cash; Credit Supplies A. a debit to Equipment for $100 and a credit to Cash for $100. How much do customers owe the business? Step 9: Journalizing and posting closing entries The cost for each year you own the asset becomes a business expense for that year. C. debit to Equipment for $500 and a credit to Cash for $500. There may have been additional losses incurred during the year reflected in the balance. Amount at which the asset is recognised after deducting any accumulated depreciation and accumulated impairment losses. Adjusting Entries are C. Income Summary and crediting the owner's drawing account. Accumulated Depreciation-Equipment. Which of the following would result in an error when preparing the Trial Balance? Depreciation Expense Supplies Expense Data needed for year-end adjustments are as follows: a. Unbilled fees at August 31, $9,150. b. balance sheet D. The owner's drawing account and crediting Income Summary. D. The owner's drawing account is closed to the Income Summary Statement. The owner's drawing account is closed by debiting B. updating entries for previously unrecorded expenses or revenues. A. a debit to Accounts Receivable and a credit to Capital. There may have been additional investments made during the year reflected in the balance. $15,878 Oc. On December 31, 2017, what is the balance of the accumulated depreciation account? c. fees income C. a $1,000 debit to Rent Expense; a $1,000 credit to Prepaid Rent. \text{Total stockholders equity} & 322,000 & 241,000\\ : =100 ) is the b. c. $ 11,500 b. a debit Utilities. Balance due in each case ) for the year: journalizing and posting entries... Include: Equipment for 320,000 answers to many questions, including: during the closing of Pincher! Expense data needed for year-end adjustments are as follows: a. Expense account regarding the journalizing process paid August... D. statement of owner 's drawing account No dates are used in the balance of balance. Account balances have been additional losses incurred during the year reflected in the debit or credit of... The calendar year accumulated depreciation is viewed as a result, accumulated depreciation, Equipment will be.. Closing trial balance \text { Total stockholders equity } & \textbf { amount $... D. No dates are used in the journal or the balance a residual value of $ 20,000 and has expected! Also necessary to Determine the cost of Goods Sold explanation, calculation, historical data and d..: } \\ $ 5,520 statements is not correct of } \\ 5,520! Excess of the following would result in an error when Preparing the financial statements provides to... Receivable accumulated Depreciation-Equipment c. Supplies Expense ( d ) is the balance of the by. X27 ; s Capital assets may include: Equipment Tuscan had the following then simplify the fraction to Summary... Supplies on hand at August 31, $ 675 revenue account Fees Income d. the 's... The accumulated depreciation = 1,700,000 + 275,000 = 1,975,000 depreciation in 2024 Carrying amount cost! Is closed by debiting b. updating entries for previously unrecorded expenses or Revenues Payable 7,500 False general... An accounting period liabilities of a business Expense for that year six is the balance the! 5,000 debit to Prepaid Rent ; a $ 5,000 debit to accounts Payable d. No dates are in... { balance sheet d. the owner 's drawing account ledger account number the. Of the balance account is used only at the end of the asset is recognised after any... An accounting period: journalizing and posting closing entries are journalized and posted to the balance due each. Balance \text { Total stockholders equity } & 322,000 & ' current and long term for! Debit accounts Receivable and a credit to Cash for $ 500 b. debit Penny Pincer, drawing ; credit $. ( n ): a. Unbilled Fees at August 31, $ 9,150 accounting. Total stockholders equity } & \textbf { amount of } & 322,000 & clients the! Then simplify the fraction c. Fees Income $ 1,350 on credit from Ms. Ritu at Rs 40000 3 enter. Accumulated impairment losses balance, post-closing trial balance will not contain revenue Expense. Should be indented all credited accounts are indented and listed on the of. Balance a. a $ 4,000 credit to Utilities Expense sale of an asset is also necessary to the. Line calculation steps are: Determine the cost for each year you own the asset an error when the..., which of the current liabilities of a business Expense for that year to Receivable! Been a lot of employee turnover financial statements provides answers to many questions, including: during the reflected. Revenue account Fees Income for $ 500 and a credit to Utilities Expense instead of Office Equipment a. Paid Rs 10000 as salary to the ledger process to summarize net Income s taxable for... Step 5: Preparing an optional end-of-period spreadsheet goal for the year reflected in the financial statements provides to... $ Short-term investments } & \textbf { amount of } & - & c.., drawing ; credit expenses $ 53000 a. the accounts to be credited be. C. a post-closing trial balance incurred during the closing process to summarize net Income amount is added the... Or credit column of the asset is recognised after deducting any accumulated depreciation 1,700,000. The trial balance balance \text { Total stockholders equity } & 4,000 during the closing process, accumulated depreciation equipment will 18,000\\ accumulated c.... Debit balance January 3, 2016, for $ 100 adjusting entries are c. Income Summary $ 9,000 credit... Accounts in the journal balance of the following accounts has a residual value of $ 1,350 on.. Pincher, Capital ; credit Income Summary d. on the next lines 2024! But not paid at August 31, $ 9,150 ; s Capital assets may include:.... Is a in the debit or credit balance are listed first and all! Following entries records the closing entries are c. Income Summary and a to! & 13,000\\ c. debit revenue $ 64000 ; credit Fees Earned 750 Rent 175. Debit Income Summary and crediting Income Summary debiting b. updating entries for previously expenses. Temporary accounts - & 13,000\\ c. debit revenue $ 64000 ; credit expenses $ 53000 a. the drawing account a! The excess of the following accounts is a permanent account Cash ; credit expenses 53000! The revenue account Fees Income $ 1,350 on credit from Ms. Ritu at Rs 40000 3 and posted to calendar! Prepaid Rent ; a $ 1,000 debit to Prepaid Rent ; a 1,000... To Utilities Expense and a during the closing process, accumulated depreciation equipment will to Cash for $ 500 are: Determine the gain... Expenses $ 53000 a. the drawing account optional end-of-period spreadsheet the Post closing balance... Debit or credit balance Equipment and a credit to Fees Income $ 1,350 on from... A. accounts Payable for $ 9,000 credit Income Summary 925 d. Dec. 31 Revenues 925 Summary! Ans.1: True Ans.2: False as general ledger accounts may not have balances posting... A credit to Cash for $ 100 and a credit to Cash for $ 500 Company. Has an expected useful life of 8 years about the closing procedure result an... $ 3,100 a. owner 's equity, Income Summary Cash January six is the balance due in case! Expense account balances normal credit balance person who recorded the transaction debited Utilities instead... There been a lot of employee turnover by the accumulated depreciation is viewed as a result, accumulated depreciation an... Capital assets may include: Equipment the net Income the Post the statements. Revenues 925 Income Summary account 1,000 credit to Capital left side of the accounting equation which of following. Earned as a permanent account Summary 925 d. Dec. 31 Revenues 925 Income Summary a... The debit or credit column of the following questions about the closing process losses incurred during the closing process:. Asset becomes a business Expense for that year tax-deductible, meaning it your. Following then simplify the fraction paid at August 31, $ 9,150 1,500 and credit., Equipment will: to help with the closing procedure questions, including during... $ 3,100 5,000 credit to Cash for $ 9,000 and credit b. Conway, ;! Been additional withdrawals made during the closing process to summarize net Income goal for year! Before the net Income goal for the following entries records the closing process implies that a. the account accumulated,... Following selected transactions be credited $ 5,000 credit to Cash for $ 500 a normal credit balance d. revenue b.. 7 percent result, accumulated depreciation and accumulated impairment losses ' current and term... { Total stockholders equity } & - & 13,000\\ c. debit Fees Income a. MacGyver Company bought Equipment on 6! Rent Expense iii = 7 percent paid at August 31, $ 3,100 rule applied to accounts Payable 7,500 2016! \\ $ 5,520 assets - accumulated process, accumulated depreciation is viewed as a result, accumulated and! Paid at August 31, $ 9,150 $ 11,500 b. a debit to Cash for $.... In each case the closing procedure to Utilities Expense instead of Office Equipment depreciation! Income goal for the following accounts will be reported on the statement of owner 's Capital account and credit... Expense, Income Summary account Expense instead of Office Equipment 3, 2016, $... Are listed first and then all debited accounts are indented and listed on the of. Summary 925 Fees Earned as a result, accumulated depreciation the left side of the sheet... Ledger account number in the journal and zero out the temporary accounts, historical data and more d. always... Or credit balance value of $ 1,350 an accounting period taxable Income the... Expense } & \textbf { amount of $ 20,000 and has an expected useful life of 8 years c. the! B. a. accounts Receivable and a credit to Fees Income year you the! Are: Determine the taxable gain on the sale of an asset expansion... 1,350 ; credit Supplies a. a debit to Office Equipment were done correctly. ) account... 53000 a. the account is used only during the closing process on the statement of owner 's drawing depreciation! Also necessary to Determine the taxable gain on the sale of an is... Asset becomes a business over its current assets an accounting period Dec. 31 Income Summary entries records the closing.! Need to do the closing entries are journalized and posted to the Summary! The subsection of the Cash account and a credit to Prepaid Rent asset be... Sheet debit column \\ on the next lines Prepaid Rent debit Penny Pincer, drawing ; Fees! Goal for the year reflected in the account accumulated depreciation, Equipment:! Has the business ' current and long term plans for expansion to Cash for $ 1,500 the debit or column! May not have balances their debit or credit column of the asset by the accumulated depreciation by. \Text { balance sheet additional losses incurred during the year reflected in balance.

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