Question

Closing Entry #1:Close ALL revenues and Sales Returns/Discounts to Income Summary. The credit to Income Summary will therefore represent Net Sales/Service Revenuesfor the period.

ii.Closing Entry #2: Close ALL expenses to Income Summary. Every individual expense, loss must be closed out with a credit, and the sum of all expenses/losses can then be debited to your Income Summary in this entry.

12/31/19 AJES Debit Credit 25,365 7,700 81,675 13,828 Adjusted Balance 12/31/1912/31/19 Closing Debit Credit 1 Debit 92,063 913,780 54,827 7,700 1,188,485 12,846 16.063 160,500 19.690 220.000 876.418 332.983 348,791 741,123 493,951 192.200 1,169,343 19,690 84,658 24,800 General Ledger Account Nant Unadi. Balance 12/31/19 Debit Credit Cash and cash equivalents 92,063 Accounts Receivable 913,780 Allowance for doubtful accounts 23,462 Interest Receivable Inventory 1,270,160 Prepaid expenses 26,774 Other Current Assets 16,063 Investments 160,500 Fair Value Adjustment Notes Reccivable 220,000 Building 876,418 Equipment and furniture 332.883 Land 348,731 Accum Depr 656,465 Goodwill 493,951 Patents 217.000 Accounts Payable 1,169,343 Dividende payable Interest payable 41,310 Uncarncd Consulting Revenue 261,220 Waqes payable 81,350 Payroll taxes payable 8,850 Income tax payable Long term liabilities 694,700 Common Stock 920,000 Paid-in capital common stock 105,000 Treasury Stock 400,000 Retained Earnings 539,069 Dividends Accum Other Comprehensive Incom Sales revenue 9,253,346 Service revenue 1,158,785 Interest Revenue 14,100 Saleg returns 162,400 Sales discounts 269,662 Product cost of goods sold 5,364,590 Service cost of goods sold 570,811 Advertising 159,080 Bad debt expense 13,894 172,343 35,875 2.910 168,463 55.204 88,877 117,225 11.760 168.463 694,700 920,000 105,000 400,000 150,000 383,069 150,000 (150,000) 9.253.346 172,343 7.700 1,331,128 21,800 81,675 162,400 269,662 5,466,265 570,811 167,824 25,365 8,744 25,365

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Answer 1

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Closing Entries
Date	Account	Debit $	Credit $
Dec 31st	Sales Revenue	9,253,346.00
	Service Revenue	1,331,128.00
	Interest Revenue	21,800.00
	Sales Returns		162,400.00
	Sales Discounts		269,662.00
	Income Summary		10,174,212.00
Dec 31st	Income Summary	9,579,787.00
	Product cost of goods sold		5,466,265.00
	Service cost of goods sold		570,811.00
	Advertising		167,824.00
	Bad Debt Expense		25,365.00
	Depreciation and amortization		109,458.00
	Professional Dues and Subscriptions		21,470.00
	Loss on Disposal		4,790.00
	Income Tax Expense		164,328.00
	Insurance		85,227.00
	Interest Expense		55,204.00
	Legal and accounting fees		106,650.00
	Miscellaneous		9,048.00
	Office Expense		220,114.00
	Payroll taxes		139,885.00
	Property taxes		104,570.00
	Repairs and Maintenance		42,028.00
	Research and Development		470,680.00
	Telephone		20,085.00
	Travel and entertainment		38,391.00
	Utilities		47,049.00
	Wages		1,000,545.00
	Salaries- Offices		710,000.00
Dec 31st	Income Summary	594,425.00		This is $ 10,174,212 less $ 9,579,787.
	Retained Earnings		594,425.00
Dec 31st	Retained Earnings	150,000.00
	Dividends		150,000.00

Please note that Unrealized gain on AFS will not be closed through Income Summary but it is to be shown in Balance Sheet as Other Comprehensive Income.