Question

AP3-11.

a) Prepare the necessary closing entries for Zoe Developments at Jan 31.

b) Determine the ending Retained Earnings account balance

os account balánce 3-11 Closing entries and ending Retained Earnings balance) tively, AW ing cash. AWL's fe of five years d below are the balances from Zoë Developments Ltd's general ledger as at January 31, 2016 DR 56,000 135,000 124,000 CR Cash Accounts receivable Inventory Prepaid expenses Equipment Accumulated depreciation, equipment Accounts payable Unearned revenue Wages payable Common shares Retained earnings Dividends declared Sales revenue Interest revenue Cost of goods sold Depreciation expense Wages expense Utilities expense Insurance expense mpany to shipping times six months' 5,000 361,000 m for the ered the tank hat it will be 120,000 32,000 5,000 11,000 103,000 88,000 ary. e paid on 21,000 count. The 956,000 19,000 560,000 10,000 41,000 9,000 12,000 weeks of the

Answer 1

Answer (A). Closing Entries as on 31 January for Zoe developments Ltd.
Date	Account Titles	Debit	Credit
Jan. 31	Sales Revenues	956,000
	Income Summary		956,000
	Sales Revenues closed to income summary
Jan. 31	Interest Revenue	19,000
	Income Summary		19,000
	Interest Revenue closed to income summary
Jan. 31	Income Summary	632,000
	Cost of Goods Sold		560,000
	Depreciation Expense		10,000
	Wages Expense		41,000
	Utilities Expense		9,000
	Insurance Expense		12,000
	Expenses closed to income summary
Jan. 31	Income Summary	343,000
	Retained Earnings		343,000
	Excess of revenue over expense closed
	to Retained earning (975,000 - 632,000)
Jan. 31	Retained Earnings	21,000
	Dividends		21,000
B) Determination of Retained earning Balance
	Beginning Balance in Retained Earning ($)	88,000
Add:	Income Summary	3,43,000
		4,31,000
Less:	Dividend (liability)	21,000
	Ending Retained Earning Balance ($)	410,000