A - Prepare an Income Statement for an Adjusted Trail Balance The Century Compan
ID: 2401508 • Letter: A
Question
A - Prepare an Income Statement for an Adjusted Trail Balance
The Century Company's adjusted trail balance contains the following balances as of December 31: Retained Earnings $8,500; Dividends $2,000, Sales $20,000; Cost of Good Sold $8,000; Selling and Administrative Expenes $3,000; Interest Expenes $1,5000; Prepare an income statment for the year.
B - Prepare Closing Entries Using the Income Summary Account Use the data from (A) to prepare the closing entries for the Century Compnay. Close the temporary accounts to income summary. The balance of $8,500 in the retained earnings account is from the beginning of the year. What is the ending retained earnings balance after posting the closing entries?
Explanation / Answer
Answer:
1
Centrury company
Income statement
Sales
20,000
Less: expanses
Cost of goods sold
8000
Selling and Admin expense
3000
Interest expense
1500
Total Expanses
12500
net income
7,500
2
No
Description
Debit $
Credit $
1
Sales
20,000
Income summary
20,000
2
Income summary
12500
Cost of goods sold
8000
Selling and Admin expense
3000
Interest expense
1500
3
Income summary
7500
Retained earning
7500
4
Retained earning
2000
Devidend
2000
Retained earning balance
=8500+7500-2000
=$14000
Centrury company
Income statement
Sales
20,000
Less: expanses
Cost of goods sold
8000
Selling and Admin expense
3000
Interest expense
1500
Total Expanses
12500
net income
7,500
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