Question

This is a partial adjusted trial balance of Sandhill Co.. 

SANDHILL CO. Adjusted Trial Balance January 31, 2022 

Supplies	Debit Credit
Prepaid Insurance	$880
Salaries and Wages Payable	1,620
Unearned Service Revenue	$1,010
Supplies Expense	860
Insurance Expense	540
Salaries and Wages Expense	1,800
Service Revenue	870

Prepare the closing entries at January 31, 2022. (If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) 

Answer 1

Date	Account titles and explanation	Debit	Credit
Jan. 31	Service revenue	4240
	Income summary		4240
	(To close revenue account)
Jan. 31	Income summary	3200
	Supplies expense		860
	Insurance expense		540
	Salaries and wages expense		1800
	(To close expense accounts)
Jan. 31	Income summary	1040
	Owner’s capital		1040
	(To close net income / (loss))

Net income = service revenue – expenses = 4240-3200 = 1040