Answer:
Explanation:
The closing entry for the following accounts are shown below:
1. Service Revenue A/c Dr $850,000
To Income Summary $850,000
(Being revenue account closed)
2. Income summary A/c Dr $595,000
To Salaries Expense $380,000
To Rent Expense $140,000
To Interest Expense $75,000
(Being expenses accounts are closed)
3. Income summary A/c Dr $255,000 ($850,000 - $595,000)
To Retained earning $255,000
(Being the difference is credited to retained earning)
4. Retained earnings A/c Dr $50,000
To Dividend A/c $50,000
(Being dividend account is closed)
