Answer:
Explanation:
The closing entries for the following accounts are shown below:
1. Service Revenue A/c Dr $31,000
To Income Summary $31,000
(Being revenue account closed)
2. Income summary A/c Dr $22,600
To Wages Expense $17,400
To Rent Expense $5,200
(Being expenses accounts are closed)
3. Income summary A/c Dr $8,400
To Retained earning $8,400
(Being the difference is credited to retained earning)
4. Retained earnings A/c Dr $1,700
To Dividend A/c $1,700
(Being dividend account is closed)
The computation of the retained earning is shown below:
= Total revenues - total expenses
= $31,000 - $22,600
= $8,400
