Posting closing entries directly to T-accounts [5 min]
It is December 31 and time for your business to close the books. The following balances appear on the books of Sarah Simon Enterprises:
a. Dividends, $8,500.
b. Service revenue, $23,700.
c. Expense account balances: Salary, $6,100; Rent, $4,000; Advertising, $3,300.
Requirements
1. Set up each T-account given and insert its adjusted balance as given (denote as Bal) at December 31. Also set up a T-account for Retained earnings, $26,100, and for Income summary.
2. Post the closing entries to the accounts, denoting posted amounts as Clo.
3. Compute the ending balance of Retained earnings.
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