merican Chip Corporation’s fiscal year-end is December 31. The following is a pa
ID: 2338856 • Letter: M
Question
merican Chip Corporation’s fiscal year-end is December 31. The following is a partial adjusted trial balance as of December 31, 2018.
American Chip Corporation's fiscal year-end is December 31. The following is a partial adjusted trial balance as of December 31, 2018. Account Title Retained earnings Sales revenue Interest revenue Cost of goods sold salaries expense Rent expense Depreciation expense Interest expense Insurance expense Debits Credits 94,000 890,000 4,500 490,000 130,000 29,000 44,000 6,400 7,400 Required Prepare the necessary closing entries at December 31, 2018. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)Explanation / Answer
Closing Entries
Date
General Journal
Debit
Credit
31-Dec
Sales Revenue
$ 890,000.00
Interest revenue
$ 4,500.00
Income Summery
$ 894,500.00
(Revenue account transferred to income summery)
31-Dec
Income Summery
$ 706,800.00
Cost of Goods Sold
$ 490,000.00
Salaries expense
$ 130,000.00
Rent Expense
$ 29,000.00
Depreciation Expense
$ 44,000.00
Interest expense
$ 6,400.00
Insurance Expense
$ 7,400.00
(Expenses accounts closed)
31-Dec
Income Summery
$ 187,700.00
Retained Earnings
$ 187,700.00
(Income summery transferred to Retained earnings)
Closing Entries
Date
General Journal
Debit
Credit
31-Dec
Sales Revenue
$ 890,000.00
Interest revenue
$ 4,500.00
Income Summery
$ 894,500.00
(Revenue account transferred to income summery)
31-Dec
Income Summery
$ 706,800.00
Cost of Goods Sold
$ 490,000.00
Salaries expense
$ 130,000.00
Rent Expense
$ 29,000.00
Depreciation Expense
$ 44,000.00
Interest expense
$ 6,400.00
Insurance Expense
$ 7,400.00
(Expenses accounts closed)
31-Dec
Income Summery
$ 187,700.00
Retained Earnings
$ 187,700.00
(Income summery transferred to Retained earnings)
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