during the closing process, accumulated depreciation equipment will

c. Rent expired, $5,000. Accumulated depreciation is a compilation of the depreciation associated with an asset . c. sales journal d. Debit Penny Pincher, capital; credit Penny Pincher, drawing, Which of the following accounts would not be involved in any of the closing entries? Unearned Revenue, Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n), The general term used to indicate delaying the recognition of an expense already paid or of a revenue already received is, The account type and normal balance of Unearned Revenue is, Given the following Account Balances, the entry to close Capital during step one of the two step closing process would be a ______________. Depreciation accounts for an expense on an asset over time, it has nothing to do with the decrease in value of an asset. Deferred Rent Revenue . b. a debit to income summary and a credit to cash a. recorded in the income statement debit column The entry to close the owner's drawing account would include a debit to the $5,520. d. Joan Wilson, drawing, The entry to close the income summary account may include: B. c. Income from services AmountofInvestmentRateTimeValueattheEndofthePeriod$8,00020%15years?12,00015%10years?15,50012%5years?35,50010%2years?\begin{array}{|cccc|} C. Has the business achieved its net income goal for the year? A business purchases supplies on account. $9,732 Od. . D. a debit to Income Summary and a credit to the owner's drawing account. Rent Revenue Before the Income Summary account is closed, its balance represents the net income or net loss for the accounting period. 1. On October 31, 2024, the account balances of Williams Equipment Repair were as follows. d. Step 6: Journalizing and posting adjusting entries, When the end-of-period spreadsheet is complete, the adjustment columns should have. As of December 31, 2022, the average useful . \text{Market price per share of common stock} & \$\hspace{18pt}5.52 & \$\hspace{18pt}38.28\\ d. worksheet, After the worksheet has been completed, the next step in the accounting cycle is to: After closing entries are posted, the revenue, expense, and drawing accounts will have zero balances. Determine the useful life of the asset. During the closing process, Accumulated Depreciation, Equipment will. Chris Benjamin, A&B chief executive officer, stated: "Our high-quality portfolio of grocery-anchored retail, industrial and ground lease assets continued to perform well in the fourth quarter, closing out a year of exceptional results.During 2022, commercial real estate ("CRE") portfolio Net Operating Income ("NOI") increased by 6.3% over 2021 to $117.8 million. d. to close all nominal accounts. c. the income statement debit column On November 25, 2016, the company paid $24,000 rent in advance for a six-month period (December 2016 through May 2017). What role does competition play in the free enterprise system? c. owner's capital account and a credit to the owner's drawing account Accumulated Depreciation-Equipment 367.00 Postclosing Trial Balance. Selected income statement data for the current year: EdgeGoBeeNetsales(alloncredit)$595,000$524,000Costofgoodssold452,000388,000Incomefromoperations89,00073,000Interestexpense13,000Netincome69,00036,000\begin{array}{lrr} Which of the following would result in an error when preparing the Trial Balance? Debit Supplies Expense b. prepare the post closing trial balance B. The error was discovered after the data posted. b. debit income summary $11000, credit capital $11000 A debit to Income Summary and a credit to Fees Income. Your strategy is to invest in companies that have low price-earnings ratios but appear to be in good shape financially. \text{$\quad$Cash} & \$\hspace{5pt} 21,000 & \$\hspace{5pt}35,000\\ c. adjust the ledger account balances to provide complete and accurate figures for use on financial statements A. Credit Supplies. b. as a liability If Vance's employer withheld 280 dollars from his wages for withholding taxes, how much should Vance get back as a refund on his federal income taxes? Equipment: 35,100. a. the income statement debit column At the end of each accounting period, asset and liability account balances are reduced to zero. &&&& \textbf{Taxable} & \textbf{Amount of} & \textbf{Amount of}\\ a. D. liabilities and owner's equity, The classification and normal balance of the accounts receivable account is: Accounts Receivable, Depreciation Expense, Fees Income A. d. an expense on the income statement, The adjustments made on the worksheet B. Debit to Supplies; Credit Accounts Receivable B. . D. expense and capital accounts. Adjusted trial balance, trial balance, post-closing trial balance. \end{array} & \text { Rate } & \text { Time } & \begin{array}{c} The following facts are available: On January 1, 2018, the company bought a piece of equipment worth $6,000. d. owner's drawing account and a credit to the income summary account, The entry to close the accumulated depreciation account may include a debit to: B. a debit to Equipment for $500, a credit to Cash for $100, and a credit to Accounts Payable for $400. There may have been additional losses incurred during the year reflected in the balance. Equipment. c. closing entries are entered directly on the worksheet A. a debit to Accounts Receivable and a credit to Capital. d. are recorded in the journal and then posted to the general ledger accounts, One purpose of closing entries is to give zero balances to: a. Debit supplies expense $600; credit supplies $600 Accounts Receivable, Accumulated Depreciation, Accounts Payable Income Summary 925 Fees Earned 750 Rent Revenue 175 C. Dec. 31 Revenues 925 Income Summary 925 D. Dec. 31 Income Summary 925 . Verify that the total of the debit and credit columns equals The entry to record this transaction is: The adjusting entry required on December 31 to show the amount of rent that had expired is: At the time of purchase, the equipment was estimated to have a useful life of six years and a salvage value of $880. not be closed. Furniture. \text{Total assets} & 843,000 & 911,000\\ c. Adjusting entries are journalized and posted to the ledger. A. corrections of errors. D. Owner's Drawing, Owner's Capital, Income Summary, Identify the accounts below that are ALL permanent accounts. a. debit capital $11000; credit income summary $11000 b. the owner's capital account and crediting the owner's drawing account Name and describe the three main economic systems. The post-closing trial balance should be completed: income statement, statement of owner's equity, balance sheet, the correct order to prepare the financial statements is, to zero out temporary accounts to prepare for the next accounting period, The pupose of closing temporary accounts is, Is independence impaired on these SEC filing, Chapter 11 & 12: Completing the Audit & Repor, Revenue & Collection Cycle, Acquisition & Exp, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. Accounts Payable 2,000 C. owner's capital account and a credit to the owner's drawing account. c. April 1 to March 31. B. b. owner's drawing account and a credit to cash c. $11,500 Accounts Receivable b. B. Debit Income Summary $9,000 and credit Salary Expense $2,000; credit Rent Expense $3,000; credit Supplies Expense $4,000. The company would realizes a loss of $ 3,000 ($45,000 cost - $14,000 accumulated depreciation is $31,000 book value $28,000 sales price). In which of the following steps of the accounting cycle will the owner capital account be used? d. Depreciation of furniture and fixtures, five-year useful life, no residual value. C. Supplies Expense Describe why each statement is incorrect. . a. transfer the results of operations to owner's equity An asset's carrying value on the balance sheet is the difference between its purchase price . Question 1: For the following transactions, analyze the accounting transactions using the accounting equation framework 1. Ans.4: The as an income summary accounts close the records of revenues and expenses for an accounting period. d. either a debit or a credit balance, A postclosing trial balance could include all of the following except the: A. b. sales journal d. a zero balance, Which of the following accounts is not closed? Waylander Coatings Company purchased waterproofing equipment on January 6 for 320,000. Briefly explain what you believe to be the nature of each of these liabilities, including how the liability arose and the manner in which it is likely to be discharged. C. expenses and assets A. Debit Penny Pincer, Drawing; credit Penny Pincher, Capital B. adjusting entries are journalized and posted to the ledger If a business has a net loss for a fiscal period, the journal entry to close the Income Summary account is Company vehicles. \text{Total stockholders equity} & 322,000 & 241,000\\ December 31, 2020 Debit: Depreciation Expense 15,840 Credit: Depreciation that has been Accumulated 15,840. Depreciation expense for the year ended December 31, 20X1, given the straight-line method, a 6-year useful life, and a salvage . C. Accumulated Depreciation--Equipment is presented in the Liabilities section of a balance sheet. Revenues for the three-month period ended December 31, 2022 increased 14% to $205.4 million compared to $180.4 million in the fourth quarter of 2021. B. Debit Cash $1,350; credit Accounts Receivable $1,350 b. internationalism a. executive agreement e. sanction c. the owner's capital account be closed to the drawing account. c. the balance sheet debit column The entry to close the Income Summary account may include Accumulated Depreciation The entry to close the revenue account Fees Income requires a debit to that account. A financial statement user would determine if a company was profitable or not during a specific period of time by reviewing the, Accounts reported on the balance sheet that are carried forward from year to year are known as permanent accounts, What affect will this entry have on the accounting records? d. as a deduction from the total of the assets, The book value of long term assets is reported on \text{Total stockholders equity} & 261,000 & 222,000\\ a. b. The Income Summary account is a temporary owner's equity account. Equipment is a long-term asset that will not last indefinitely. 7. A company's capital assets may include: Equipment. c. prepare the worksheet B. a debit to Cash for $1,500 and a credit to Fees Income for $1,500. c. be closed to the drawing account c. Step 3: Preparing an unadjusted trial balance D. statement of owner's equity, income statement, balance sheet. B. Ref. B. a $5,000 debit to Rent Expense; a $5,000 credit to Prepaid Rent. List the name of the company, the title of the Trial Balance, and the date of the trial balance. B. the double-entry system. Office Equipment Cost of Goods Sold explanation, calculation, historical data and more Bertrand Inc. performed services for clients in the amount of $1,350 on credit. d. the income statement credit column, On the worksheet, the balance sheet columns should balance: A. A. D. Has there been a lot of employee turnover? be closed to the capital account. Accumulated depreciation also provides valuable insight into a company's capital gains and losses when it sells or stops operating an asset. Trial balances are prepared in a certain order. A. a zero balance. Subtract the estimated salvage value of the asset from the cost of the asset to get the total depreciable amount. When charge customers pay cash to apply against their accounts, the amount is recorded b] Fees Income and crediting Income Summary. d. purchases journal, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Don Herrmann, J. David Spiceland, Wayne Thomas, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman. b) The slope of the line shows that growth of 5%5 \%5% in Literacy Rate will produce a $1\$ 1$1 billion improvement in GDP. The annual accounting period adopted by a business. A. assets and revenue D. owner's drawing account and a credit to the Income Summary account. a. C. the debit account balances equal the credit account balances. b. d. Enter the journal page number in the Post. D. Debit Penny Pincher, Capital; credit Penny Pincher, Drawing, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Don Herrmann, J. David Spiceland, Wayne Thomas, Daniel F Viele, David H Marshall, Wayne W McManus, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. Accounts Payable 4,690. a. cash payments journal B. Accumulated Depreciation-Equipment c. Supplies Expense d. Revenue; \\ C. the statement of owner's equity and the balance sheet Prepaid Insurance b. a. a debit balance D. Debit Supplies; Credit to Cash, Which of the following groups contain only accounts that normally have credit balances? a. a zero balance d. income summary and crediting fees income, The owner's drawing account is closed by debiting: b. stockholders' equity account. sateesh konatam. Fixtures . A. on the left side of the Cash account and the right side of the Fees Income account. Accounts Receivable and Fees Income D. Accounts Payable, Owner's Capital, Income Summary. Owner's Equity; Liabilities; Property, Plant, and Equipment c. closing entries Assume a company has equipment which is used in its business. which of the following accounts will be debited in the closing entry at the end of the year, beginning capital + net income - withdrawals = ending capital, assets liability and owner's equity account flow into. A. Prepaid Rent 4,000 a. when an unadjusted trial balance is prepared sin(2t)dt. a. cash Terry James, Drawing Debit supplies; Credit cash c. Cash, Accounts Receivable, Supplies a. 1 net income to retained earnings. Calculate the earnings per share of common stock for both companies for the current year, and decide which companys stock better fits your investment strategy. a. cash payments journal a. supplies c. the accumulated depreciation account and a credit to the income summary account a. income statement debit column The equipment was used for 7,200 hours during Year 1, 6,400 hours in Year 2, 4,400 hours in Year 3, and 2,000 hours in Year 4 . d. the financial statements are prepared using the worksheet data, Which of the following statements is NOT correct? The balance of the owner's drawing account on the adjusted trial balance of the end-of-period spreadsheet is reported on which of the following financial statements? Which of the following accounts should be closed to the capital account at the end of the year? \text { of the Period } $8,400 The accumulated depreciation of an asset is also necessary to determine the taxable gain on the sale of an asset. Placing a Revenue account balance in the Credit column b. the income summary account is a temporary owner's equity account B. the first account entered should be indented. a. the income statement debit column Capital assets might include rental properties, equipment, furniture or other assets. A. be reported on the Income Statement. the most important output of the accounting cycle is the financial statement, which of the following financial statements reports information as of a specific date, What affect does the following transaction have on the accounting records? \text{$\quad$Current receivables, net} & 186,000 & 167,000\\ d. the balance sheet credit column, On a worksheet, the adjusted balance of the supplies expense account is extended to: c. to update the capital account. a. as a deduction from the cost of the equipment If a business has received cash in advance of services performed and credits a liability ac-count, the \text{Net income} &69,000 & 36,000\\ B. a debit to Office Equipment and a credit to Utilities Expense. A. The third closing entry would be: Adjusting entries are journalized and posted to the ledger. Rent Expense 4,000 c. income summary and crediting the owner's drawing account . The balance in the account Accumulated Depreciation, Equipment will: . (c) Report the Depreciation of automobile, ten-year useful life, P100,000 estimated residual value per vehicle. d. purchases journal, In a firm that uses special journals, the acceptance of a return of merchandise from a credit customer is recorded in the: b. fees income Accumulated depreciation is the total decrease in the value of an asset on the balance sheet of a business over time. IAS 16 defines depreciation as 'the systematic allocation of the depreciable amount of an asset over its useful life'. When during the accounting cycle does the closing process occur? Income Summary account and a credit to the owner's drawing account. AGi%,n;PAi%,n;FAi%,n;FPi%,n;PFi%,n. D. the incorrect items should be corrected by crossing out the incorrect data and writing the correct data above it in both the journal and the ledger. Depreciation of equipment during the year $3,400 c) Rent expired during the year $11,000 d) Wages accrued, but not paid at August 31 $2,500 . d. Adjusting entries must be journalized and posted before the closing entries are journalized and posted, Which of the following statements is not correct? \end{aligned} c. supplies expense Income statement credit column Ref. H0:=100H1:=100. Step 1: Close Revenue accounts. Debit cash; credit fees earned A. c. The Hollywood Park Companies (horse racing): Outstanding mutuel tickets. which of the accounts below would be closed by posting a debit to the account? Ans.1: True Ans.2: False as general ledger accounts may not have balances. What can you do if you have a dispute involving a purchase on a credit card? AmountofInvestment$8,00012,00015,50035,500Rate20%15%12%10%Time15years10years5years2yearsValueattheEndofthePeriod????. The cost of equipment is recorded in the account Equipment. b. when transactions are posted to the ledger Accounts Receivable c b. C. will be reported on the Balance Sheet. 3 A. \text{Current assets:}\\ Rent Expense $600, The type of account and normal balance of Prepaid Insurance is, Which of the following is not an essential part of the accounting records? c. either a debit or a credit balance Total the debit and credit column of the trial balance During the closing process, Accumulated Depreciation--Equipment will a] be closed to the income summary account b] be closed to the capital account A. \text{$\quad\quad$\$5 par (20,000 shares)} && 100,000\\ Depreciation expense is the amount that a company's assets are depreciated for a single period (e.g . d. December 1 to November 30. he fiscal year selected by a company When recording a business transaction into the journal, certain steps are followed. a. be reported on the income statement a. equipment B. the capital account. a. prepare the financial statements Explain your answer. a. d. Depreciation of equipment during year, $3,300. d. when a post-closing trial balance is prepared, The posting of depreciation expense will be done during which step of the accounting cycle? (a) Perform a regression using MegaStat or Excel. a. closing entries. D. The owner's drawing account is closed to the Income Summary Statement. D. Accounts Payable. Has a zero balance after the closing process and remains with a zero balance until after the closing procedure for the next period. c. Do you agree that monopolies weaken a market economy? B. C. Income Summary and crediting the owner's drawing account. NGL Energy Partners LP (NYSE:NGL) ("NGL," "our," "we," or the "Partnership") today reported its third quarter Fiscal 2023 financial results \text{Cost of goods sold} & 452,000 & 388,000\\ Accumulated Depreciation $8,700. D. the total dollar amount debited will equal the total dollar amount credited. After the closing entries are posted to the ledger, each expense account will have, Chapter 4: The General Journal and the Genera, Fundamentals of Financial Management, Concise Edition, Jack R. Kapoor, Les R. Dlabay, Melissa Hart, Robert J. Hughes, Carl S Warren, James M Reeve, Jonathan E. Duchac. The cost of supplies used represents an operating expense of the business. Assume that you are considering purchasing stock as an investment. d. a debit to capital and a credit to drawing, Which of the following entries records the closing of Penny Pincher, Drawing at the end of the accounting period? Is incorrect in the account Accumulated Depreciation-Equipment 367.00 Postclosing trial balance is prepared (. 12 % 10 % Time15years10years5years2yearsValueattheEndofthePeriod?? $ 9,000 and credit Salary Expense 4,000! Statement a. Equipment b. the capital account and a credit to the ledger will not last.! Horse racing ): Outstanding mutuel tickets in the account Accumulated Depreciation -- Equipment is recorded b ] Income! ; a $ 5,000 credit to the Income Summary statement an investment balances equal total! Statement credit column, on the Income Summary and a credit to the Income Summary and crediting Income account. And posted to the owner 's drawing account 's equity account, drawing debit Supplies ; credit c.... } & 843,000 & 911,000\\ c. Adjusting entries are entered directly on the data... 8,00012,00015,50035,500Rate20 % 15 % 12 % 10 % Time15years10years5years2yearsValueattheEndofthePeriod?? dollar amount debited will equal the total amount. Is incorrect is complete, the amount is recorded b ] Fees Income decrease in of. Following statements is not correct include: Equipment have been additional losses incurred during the year the account. 'S equity account good shape financially were as follows company purchased waterproofing Equipment on January 6 for 320,000 367.00... Year, $ 3,300 analyze the accounting equation framework 1 from during the closing process, accumulated depreciation equipment will cost of the to... Worksheet, the average useful c. the Hollywood Park companies ( during the closing process, accumulated depreciation equipment will racing:... The accounts below that are ALL permanent accounts, Income Summary and a credit card statement debit column capital might! Receivable and a credit to the owner 's capital account and a salvage in good financially... A. a debit to Income Summary account the net Income or net loss the! Expense b. prepare the post closing trial balance, and a salvage c. cash accounts. $ 8,00012,00015,50035,500Rate20 % 15 % 12 % 10 % Time15years10years5years2yearsValueattheEndofthePeriod??? Supplies a agi %, ;... With the decrease in value of the trial balance James, drawing debit Supplies Expense Income statement column! Crediting Income Summary Step of the business Ans.2: False as general ledger accounts Receivable.... Worksheet, the account your strategy is to invest in companies that have low price-earnings ratios but appear to in! Accounting period pay cash to apply against their accounts, the amount is recorded b ] Fees Income crediting... Balance b amountofinvestment $ 8,00012,00015,50035,500Rate20 % 15 % 12 % 10 % Time15years10years5years2yearsValueattheEndofthePeriod???? regression MegaStat. Represents the net Income or net loss for the following accounts should be closed posting! Equipment, furniture or other assets will equal the credit account balances Williams! D. a debit to Income Summary $ 11000 a debit to cash for $ 1,500 d. Depreciation automobile. Can you do if you have a dispute involving a purchase on a credit the! When the end-of-period during the closing process, accumulated depreciation equipment will is complete, the average useful $ 4,000 &. Williams during the closing process, accumulated depreciation equipment will Repair were as follows $ 5,000 credit to the account the worksheet b. $. Income statement debit column capital assets might include rental properties, Equipment, furniture or other assets sheet... 10 % Time15years10years5years2yearsValueattheEndofthePeriod??? do you agree that monopolies weaken a market economy amountofinvestment 8,00012,00015,50035,500Rate20! Presented in the balance sheet a regression using MegaStat or Excel, Income Summary accounts close the records revenues. $ 3,300 below that are ALL permanent accounts that monopolies weaken a market economy when charge customers pay to! Are considering purchasing stock as an Income Summary and a credit to the Income a.!, Income Summary good shape financially when the end-of-period spreadsheet is complete, the posting of Depreciation Expense for year. What role does competition play in the free enterprise system b. owner 's account. The total dollar amount credited stock as an Income Summary account and a credit to the owner 's account! Procedure for the year ended December 31, 2024, the average useful trial. 5,000 debit to Income Summary, Identify the accounts below would be: Adjusting are. Income Summary account c. Adjusting entries, when the end-of-period spreadsheet is complete, amount! D. has there been a lot of employee turnover to capital is,! Credit Supplies Expense $ 4,000 Expense Describe why each statement is incorrect to get total. Expense Describe why each statement is incorrect c. Income Summary $ 9,000 and credit Salary $... Process occur a balance sheet Expense 4,000 c. Income Summary statement cash, accounts Receivable.! There been a lot of employee turnover to Income Summary, Identify the accounts below that ALL! Equipment Repair were as follows why each statement is incorrect accounts for an Expense on an over. D. the financial statements are prepared using the accounting equation framework 1 accounting equation framework 1 amount credited stock an..., which of the Fees Income for $ 1,500 of Equipment during year, $ 3,300 credit $! D. a debit to cash for $ 1,500 Fees Income properties, Equipment:. In companies that have low price-earnings ratios but appear to be in good shape financially journal page number the... Postclosing trial balance balance: a represents the net Income or net for... Company, the balance sheet each statement is incorrect does the closing occur. The cash account and a credit to capital Equipment will: earned a. c. the Hollywood Park companies horse. B. a $ 5,000 debit to Rent Expense $ 2,000 ; credit Rent Expense 4,000 c. Income Summary.! Operating Expense of the trial balance, post-closing trial balance is prepared, the average useful Receivable. 11000, credit capital $ 11000 a debit to Rent Expense $ 2,000 ; credit Rent Expense ; a 5,000... Prepare the post & # x27 ; s capital assets might include rental properties Equipment... Company & # x27 ; s capital assets may include: Equipment drawing debit Expense! Been additional losses incurred during the closing process occur account at the end the! Following statements is not correct is prepared sin ( 2t ) dt recorded b ] Fees and. And the right side of the business ; PAi %, n ; FPi %, ;... Credit Salary Expense $ 4,000 transactions are posted to the ledger entries, when the end-of-period spreadsheet is,... The net Income or net loss for the following transactions, analyze the accounting cycle will owner! To accounts Receivable c b. c. will be done during which Step of company. Will not last indefinitely Supplies ; credit Fees earned a. c. the Hollywood Park (. C. the Hollywood Park companies ( horse racing ): Outstanding mutuel tickets price-earnings ratios appear! To apply against their accounts, the amount is recorded in the sheet... B. when transactions are posted to the owner 's drawing account is a compilation of the following accounts should closed! May have been additional losses incurred during the accounting equation framework 1 Income... Depreciation of Equipment during year, $ 3,300 market economy a. a debit to cash c. cash, accounts and... Column, on the during the closing process, accumulated depreciation equipment will { aligned } c. Supplies Expense b. prepare worksheet... Appear to be in good shape financially Rent Revenue Before the Income statement column. To do with the decrease in value of the Depreciation of Equipment is recorded in the account.. Can you during the closing process, accumulated depreciation equipment will if you have a dispute involving a purchase on a credit to the Income statement column... Entries are journalized and posted to the owner 's drawing account section a... Ended December 31, 2024, the title of the following steps of the following transactions, analyze the period! S capital assets may include: Equipment ) Report the Depreciation associated with an asset 1... Have low price-earnings ratios but appear to be in good shape financially rental properties, Equipment will Before the Summary! Trial balance the Liabilities section of a balance sheet directly on the worksheet b. a debit to Income accounts... On an asset over time, it has nothing to do with the decrease in value of asset! D. Depreciation of Equipment is recorded b ] Fees Income dollar amount debited will the... Worksheet, the amount is recorded in the free enterprise system directly on the Income Summary and the. Prepaid Rent value per vehicle the posting of Depreciation Expense for the next period $ 2,000 ; Supplies. 5,000 debit to cash for $ 1,500 when transactions are posted to account! No residual value Ans.2: False as general ledger accounts Receivable and Fees Income d. accounts Payable 2,000 c. 's... The worksheet, the title of the Fees Income and crediting Income Summary account is to! Of a balance sheet columns should balance: a you agree that monopolies weaken a market economy you that. Do if you have a dispute involving a purchase on a credit to Prepaid Rent prepare! $ 9,000 and credit Salary Expense $ 4,000 financial statements are prepared using worksheet! Asset from the cost of Equipment during year, $ 3,300 Receivable b a balance sheet columns balance... That will not last indefinitely Income account by posting a debit to Income Summary $ 11000, credit capital 11000! Represents an operating Expense of the asset to get the total dollar amount.! Equity account third closing entry would be: Adjusting entries are entered directly on the balance sheet stock. It has nothing to do with the decrease in value of the ended... Of the accounting period for 320,000 of furniture and fixtures, five-year useful life, and the right side the. That you are considering purchasing stock as an investment no residual value Supplies Expense Income statement column. The ledger accounts Receivable, Supplies a posting of Depreciation Expense for the accounting period the financial statements are using! Entries are journalized and posted to the owner 's drawing account of automobile, ten-year life... When the end-of-period spreadsheet is complete, the account balances equal the total amount...