Question

The income statement for the Windsor, Inc. for the month ended July 31 shows Service Revenue $17,610, Salaries and Wages Expense $8,490, Maintenance and Repairs Expense $3,250, and Income Tax Expense $1.490. The statement of retained earnings shows an opening balance for Retained Earnings of $20,700 and Dividends $1,430.

Answer 1

Date	Particulars	Debit	Credit
July 31	Service Revenue A/C..Dr	17,610
	To Income Summary		17,610
	(To Close Revenue Account)
July 31	Income Summary A/C..Dr	13,230
	To Salaries and Wages Expense		8,490
	To Maintenance and Repairs Expense		3,250
	To Income Tax Expense		1,490
	(To Close Expense Account)
July 31	Income Summary A/C..Dr	4,380
	To Retained Earnings		4,380
	( To Close Net Income to Retained Earnings)
July 31	Retained Earnings A/ C...Dr	1,430
	To Dividends		1,430
	(To close dividends Account)

Supporting Work

Net Income = 17,610 - 13,230 = $ 4,380

Closing Balance of Retained Earnings = 20,700 + 4,380 (Net Income) - 1,430 (Dividends) = $ 23,650