Saved Help Save & Exit S On December 31, the Income Summary account of Madison C

Question

Saved Help Save & Exit S On December 31, the Income Summary account of Madison Company has a debit balance of $111,000 after revenue of $117000 and expenses of $228,000 were closed to the account. Madison Wells, Drawing has a debit balance of $12,000 and Madison Wells Capital has a credit balance of $174,000. Required: 1. Record the journal entries necessary to complete closing the accounts 2. What is the new balance of Madison Wells, Capital? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Record the journal entries necessary to complete closing the accoun ts. View transaction list Journal entry worksheet 2

Explanation / Answer

Closing entry :

b) New balance = (174000-111000-12000) = 51000

Date accounts & explanation debit credit Owner's capital 111000 Income summary 111000 (To record close income summary account) Owner's capital 12000 Owner's drawings 12000 (To close drawing account)

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