Question

The following is a list of accounts and adjusted amounts for Rollcom, Inc., for the fiscal year ended September 30, 2018. The accounts have normal debit or credit balances. Accounts Payable $ 39,400 Accounts Receivable 66,800 Accumulated Depreciation 21,800 Cash 80,600 Common Stock 95,100 Equipment 91,000 Income Tax Expense 10,530 Notes Payable (long-term) 1,530 Office Expenses 6,330 Rent Expense 164,500 Retained Earnings 99,870 Salaries and Wages Expense 129,000 Sales Revenue 326,560 Supplies 35,500 rev: 09_27_2018_QC_CS-140758 Prepare the closing entry required at September 30, 2018. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

Answer:

Sales Revenue 326,560 debit

    Income Summary           326,560 credit

-- to close revenues account--

Income Summary        310,360 debit

Income Tax Expense                10,530 credit

Office Expenses                          6,330 credit

Rent Expense                           164,500 credit

Salaries and Wages Expense 129,000 credit

--to close expenses account--

Income Summary          16,200 debit

            Retained Earnings       16,200 credit

-- to close retained earnings--

Explanation:

To close the accounting period, we will use income summary account.

We will use it against revenues, expenses and dividends. Then his balance will be closed against retained earnings.

Income Summary balance: 326,560 - 310,360 = 16,200