The closing process is illustrated in the following diagram with the use of T ac

Question

The closing process is illustrated in the following diagram with the use of T accounts. As you can see, Drawing is not closed to Income Summary but closed directly into Capital. This is because Drawing is not an expense and does not reduce net income. Using the adjusted trial balance provided below, complete the closing entries in the following T accounts. Owner's Capital 20,000 5,000 Bal Income Summary Bal. Owner's Drawing 5,000 5,000 Selling Expense 155,600 155,600 Fees Earned 175,600 175,600 Depreciation Expense 47,200 47,200 V Rent Revenue 129,200 129,200

Explanation / Answer

Owner's capital 5000 20000 102000 Bal. 117000 Income Summary 202800 304800 Bal. 102000

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