A company purchased land for $90,000 cash. real estate brokers' commission was $5,000 and $7,000 was spent for demolishing an ol
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Answer:
A) Adjusting entries:
Dr Sales salaries expense 2,400
Cr Sales salaries payable 2,400
Dr Selling expenses 2,100
Cr Prepaid selling expenses 2,100
Dr Cost of goods sold 3,700
Dr Merchandise inventory 3,700
B) prepare the closing entries
Dr Sales revenue 550,900 (net = $557,000 - $19,900 - $6,200)
Cr Income summary 550,900
Dr Income summary 484,200
Cr Cost of goods sold 239,700 (net = $236,000 + $3,700)
Cr Sales salaries expense 62,400 (net = $60,000 + $2,400)
Cr Selling expense 44,100 (net = $42,000 + $2,100)
Cr Utilities expense 21,000
Cr Administrative expense 117,000
Dr Income summary 66,700 (= $550,900 - $484,200)
Cr Retained earnings 66,700
Dr Retained earnings 45,000
Cr Dividends 45,000
