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Unformatted text preview: 0X7. The company has completed preparation of financial statements and is now ready to prepare closing entries. BEAVER LODGE Adjusted Trial Balance As of December 31, 20X7 Debits Cash $ Credits 80,100 $ - Accounts Receivable 53,325 - Supplies 16,875 - 732,825 - Accumulated deprec. Equipment - 90,900 Accounts Payable - 78,300 Loan Payable - 225,000 Capital Stock - 180,000 Retained earnings - 157,500 45,000 - Dividends Revenues - 1,076,400 Rent Expense 270,000 - Salaries Expense 530,100 - Supplies Expenses 40,500 - Interest Expenses 16,650 - Depreciation expense 22,725 - $ 1,808,100 $ 1,808,100 a) Prepare the necessary closing entries. b) Use T-accounts to determine the post-closing balances of the accounts. c) Prepare the post-closing trial balance. Download free eBooks at bookboon.com 17 Problem 3: Worksheet Accounting Cycle Exercises IV Worksheet 3 (a) GENERAL JOURNAL Date Accounts Debit Credit Dec. 31 To close the revenue account to Income Summary Dec. 31 To close the expense accounts to Income Summary Dec. 31 To close Income Summary to retained earnings Dec. 31 To close dividends Worksheet 3 (b) CASH DIVIDENDS closing ACCOUNTS RECEIVABLE REVENUES closing SUPPLIES RENT EXPENSE closing EQUIPMENT SALARIES EXPENSE closing Download free eBooks at bookboon.com 18 Problem 3: Worksheet Accounting Cycle Exercises IV ACCUMULATED DEPRECIATION SUPPLIES EXPENSE closing ACCOUNTS PAYABLE INTEREST EXPENSE closing LOAN PAYABLE DEPRECIATION EXPENSE closing CAPITAL STOCK INCOME SUMMARY closing closing closing RETAINED EARNINGS closing closing Worksheet 3 (c) BEAVER LODGE Post-Closing Trial Balance As of December 31, 20X7 Debits $ Credits - $ - - - - - - - - - - - - - $ - - - $ - Download free eBooks at bookboon.com 19 Problem 3: Solution Accounting Cycle Exercises IV Solution 3 (a) GENERAL JOURNAL Date Dec. 31 Accounts Debit Revenues Credit 1,076,400 Income Summary 1,076,400 To close the revenue account to Income Summary Dec. 31 Income Summary 879,975 Rent Expense 270,000 Salaries Expense 530,100 Supplies Expense 40,500 Interest Expense 16,650 Depreciation Expense 22,725 To close the expense accounts to Income Summary Dec. 31 Income Summary 196,425 Retained Earnings 196,425 To close Income Summary to retained earnings Please click the advert Free online Magazines Click here to download SpeakMagazines.com Download free eBooks at bookboon.com 20 Problem 3: Solution Accounting Cycle Exercises IV Dec. 31 Retained Earnings 45,000 Dividends 45,000 To close dividends Solution 3 (b) CASH DIVIDENDS 80,100 45,000 45,000 closing 0 ACCOUNTS RECEIVABLE REVENUES 53,325 closing 1,076,400 1,076,400 0 SUPPLIES RENT EXPENSE 16,875 270,000 270,000 closing 0 EQUIPMENT SALARIES EXPENSE 732,825 530,100 530,100 closing 0 ACCUMULATED DEPRECIATION SUPPLIES EXPENSE 90,900 40,500 40,500 closing 0 ACCOUNTS PAYABLE INTEREST EXPENSE 78,300 16,650 16,650 closing 0 LOAN PAYABLE DEPRECIATION EXPENSE 225,000 22,725 22,725 closing 0 CAPITAL STOCK INCOME SUMMARY 180,000 closing 879,975 1,076,400 cl...
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This document was uploaded on 09/24/2013.

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