Question

The following is a list of accounts and adjusted amounts for Rollcom, Inc., for the fiscal year ended September 30, 2018. The accounts have normal debit or credit balances. Accounts Payable $ 39,400 Accounts Receivable 66,800 Accumulated Depreciation 21,800 Cash 80,600 Common Stock 95,100 Equipment 91,000 Income Tax Expense 10,530 Notes Payable (long-term) 1,530 Office Expenses 6,330 Rent Expense 164,500 Retained Earnings 99,870 Salaries and Wages Expense 129,000 Sales Revenue 326,560 Supplies 35,500 rev: 09_27_2018_QC_CS-140758 Prepare the closing entry required at September 30, 2018. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

Answer:

Sales Revenue 326,560 debit

    Income Summary           326,560 credit

-- to close revenues account--

Income Summary        310,360 debit

Income Tax Expense                10,530 credit

Office Expenses                          6,330 credit

Rent Expense                           164,500 credit

Salaries and Wages Expense 129,000 credit

--to close expenses account--

Income Summary          16,200 debit

            Retained Earnings       16,200 credit

-- to close retained earnings--

Explanation:

To close the accounting period, we will use income summary account.

We will use it against revenues, expenses and dividends. Then his balance will be closed against retained earnings.

Income Summary balance: 326,560 - 310,360 = 16,200

Answer 2

Closing entries refer to the recording of transactions in the books of journal entry on the last date of the financial year. The journal entries in the books of Rollcom Inc. on the closing date are attached with an image below, please refer.

What is a Journal entry?

The recording of journal entries is a method of recording the monetary transactions of the business, whether realized or accrued, in the chronological order of their occurrence.

The books of journal entries are the primary books of accounting for a business, where the remaining balances from the entries are further recorded in the trial balances of the business.

Hence, the relevant journal entries that will take place in the books of Rollcom Inc. as on the closing date of the year are attached in the image below for reference.

Learn more about Journal Entries here:

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