Ch5 Homework graded

Ch5 Homework graded - Homework Manager - Financial...

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Score 3/3 Your response Correct response Exercise 5.7: Closing Entries of a Profitable Company L.O. 2, 4 Gerdes Psychological Services, Inc., closes its temporary accounts once each year on December 31. The company recently issued the following income statement as part of its annual report: Gerdes Psychological Services, INC Income Statement For the year Ended December 31, 2007 Revenue: Counseling revenue $ 350,000 Expenses: Advertising expense $ 2,900 Salaries expense 93,000 Office supplies expense 1,600 Utilities expense 850 Malpractice insurance expense 5,000 Office rent expense 22,000 Continuing education expense 2,550 Depreciation expense: fixtures 3,000 Miscellaneous expense 8,000 Income taxes expense 37,500 176,400 Net income $173 ,600 The firm's statement of retained earnings indicates that a $6,000 cash dividend was declared and paid during 2007. Instruction a: Prepare the necessary closing entries on December 31, 2007. General Journal Debit Credit Counseling Revenue (3%) 350,000 (3%) Income Summary (3%) 350,000 (3%) Income Summary (3%) 176,400 (3%) Advertising Expense (3%) 2,900 (3%) Salaries Expense (3%) 93,000 (3%) Office Supplies Expense (3%) 1,600 (3%) Utilities Expense (3%) 850 (3%) Malpractice Insurance Expense (3%) 5000 (3%) Office Rent Expense (3%) 22000 (3%) Continuing Education Expense (3%) 2550 (3%) Depreciation Expense: Fixtures (3%) 3000 (3%) Miscellaneous Expense (3%) 8000 (3%) Income taxes expense (3%) 37500 (3%) Income Summary (3%) 173600 (3%) Retained Earnings (3%) 173600 (3%) Retained Earnings (3%) 6000 (3%) Dividends (3%) 6000 (3%) Exercise 5.7: Closing Entries of a Profitable Company L.O. 2, 4 Gerdes Psychological Services, Inc., closes its temporary accounts once each year on December 31. The company recently issued the following income statement as part of its annual report: Gerdes Psychological Services, INC Income Statement For the year Ended December 31, 2007 Revenue: Counseling revenue $ 350,000 Expenses: Advertising expense $ 2,900 Salaries expense 93,000 Office supplies expense 1,600 Utilities expense 850 Malpractice insurance expense 5,000 Office rent expense 22,000 Continuing education expense 2,550 Depreciation expense: fixtures 3,000 Miscellaneous expense 8,000 Income taxes expense 37,500 176,400 Net income $173 ,600 The firm's statement of retained earnings indicates that a $6,000 cash dividend was declared and paid during 2007. Instruction a: Prepare the necessary closing entries on December 31, 2007. General Journal Debit Credit Counseling Revenue 350,000 Income Summary 350,000 Income Summary 176,400 Advertising Expense 2,900 Salaries Expense 93,000 Office Supplies Expense 1,600 Utilities Expense 850 Malpractice Insurance Expense 5000 Office Rent Expense 22000 Continuing Education Expense 2550 Depreciation Expense: Fixtures 3000 Miscellaneous Expense 8000 Income taxes expense 37500 Income Summary 173600 Retained Earnings 173600 Retained Earnings 6000 Dividends 6000
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This note was uploaded on 09/24/2008 for the course ACCT 116A taught by Professor Tuttle during the Summer '08 term at San Diego.

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Ch5 Homework graded - Homework Manager - Financial...

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