Question

Abc has the following balances on december 31 prior to closing entries: revenues $25,000 retained earnings, jan. 1 20,000 cash 3,000 expenses 10,000 accounts payable 4,000 dividends 2,000 supplies 17,000 based upon the balances above, what net adjustment would be made to retained earnings due to closing entries? an increase of (just type numbers).

Answer 1

The Expected  increase is mathematically given as

En= $13000

Given Data

Question Parameters:

• revenues $25,000
• retained earnings, jan. 1 20,000
• cash 3,000
• expenses 10,000
• accounts payable 4,000
• dividends 2,000
• supplies 17,000

Expected  increase

Generally the equation for the  Net adjustment  earnings is mathematically given as

En= Revenues - Expenses - Dividend

En = 25000 - 10000 - 2000

En= $13000

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