The ledger of Sheridan Company contains the following balances: Owner’s Capital

Question

The ledger of Sheridan Company contains the following balances: Owner’s Capital $30,100, Owner’s Drawings $2,800, Service Revenue $51,000, Salaries and Wages Expense $27,100, and Supplies Expense $7,800.

Prepare the closing entries at December 31. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

(To close revenue account)

(To close expense accounts)

(To close net income/ (loss))

(To close drawings)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31

(To close revenue account)

Dec. 31

(To close expense accounts)

Dec. 31

(To close net income/ (loss))

Dec. 31

(To close drawings)

Explanation / Answer

Closing entry :

Date account and explanation debit credit Dec 31 Service revenue 51000 Income summary 51000 (To close revenue account) Dec 31 Income summary 34900   Salaries and Wages Expense 27100   Supplies Expense 7800 (To close expenses accounts) Dec 31 Income summary 16100 Owner's capital 16100 (To close net income/ (loss)) Dec 31 Owner's capital 2800   Owner's Drawings 2800 (To close drawings)

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