Answer and Explanation:
The journal entries are shown below:
Sales Revenue $492,000
Interest Revenue $6,000
Gains on Sale of Investment $8,000
To Profit or Loss $506.000
(being the closing of revenue accounts is recorded)
Profit or Loss $440,000
To Salaries Expense $80,000
To Advertising Expense $10,000
To Cost of Goods Sold $284,000
To Insurance Expense $12,000
To Interest Expense $4,000
To Income Tax Expense $30,000
To Depreciation Expense $20,000
(being the closing of expenses accounts is recorded)
Net Income $66,000 ($506,000 - $440,000)
To Profit or Loss $66,000
(being Recording of profit earned)
