Answers

EX 4-17

Closing Entries
July 31 Fees Earned 337,900
Income Summary 337,900

31 Income Summary 362,000

Wages Expense 277,500
Rent Expense 54,000
Supplies Expense 14,300
Miscellaneous Expense 16,200

31 Gail Sabatini, Capital 24,100

Income Summary 24,100

31 Gail Sabatini, Capital 45,000

Gail Sabatini, Drawing 45,000

Ex 4-18:

a Accounts Receivable Appears in post closing trial balance

b Cash
c Depreciation Expense
d Fee Earned
e Doug Woods, Capital
f Doug Woods, Drawings
g Equipment
h Land
i Salaries Payable
j Unearned Rent
k Wages Expense
Appears in post closing trial balance
Does not appear in post closing trial balance
Does not appear in post closing trial balance
Appears in post closing trial balance
Appears in post closing trial balance
Appears in post closing trial balance
Appears in post closing trial balance
Appears in post closing trial balance
Appears in post closing trial balance
Does not appear in post closing trial balance
PR 4-1A

(1) Income statement for the year ended December 31.

BEACONS COMPANY
Income Statement
For the year ended December 31. 2019
Revenues:
Fees Revenue $ 401,200
Rent Revenue $ 1,300
Total Revenues $ 402,500
Expenses :
Salaries and Wages Expense $ 168,000
Advertising Expense $ 21,700
Utilities Expense $ 11,400
Depreciation Expense-Building $ 9,000
Repairs Expense $ 8,850
Depreciation Expense-Equipment $ 4,500
Insurance Expense $ 3,000
Supplies Expense $ 2,250
Miscellaneous Expense $ 4,350
Total Expenses $ 233,050
Net Income $ 169,450

(2) Statement of Owner’s Equity

BEACONS COMPANY
Statement of Owner’s Equity
For the year ended December 31. 2019
Sarah Colin, Capital, January 1,2019 $ 238,100
Net income for the year $ 169,450
Withdraws ($10,000)
Increase in owner’s equity 159,450
Sarah Colin, Capital, December 31, 2019 $ 397,550
(3) Balance Sheet

BEACONS COMPANY
Balance Sheet
December 31. 2019
Assets
Current assets:

Cash $ 13,000
Accounts receivable $ 53,000

Prepaid insurance 1,200

Supplies 750

Total current assets 67,950

Property, plant, and equipment:

Land $ 98,000

Building $ 500,000

Accumulated depreciation $264,300 235,700

Equipment $ 121,900

Accumulated depreciation 104,600 17,300

Total property,plant &equipment 351,000

Total assets $ 418,950

Liabilities

Current liabilities:
Accounts payable $ 15,700

Salaries and wages payable 4,900

Unearned rent 800

Total liabilities: $ 418,950

Owner’s Equity

Sarah Colin, Capital 397,350

 Total liabilities and owner’s equity $ 418,950

(4) Journal of Closing Entries

JOURNAL
Date Description Debit Credit
2019 Closing Entries
Dec 31 Fees Revenue 401,200
Rent Revenue 1,300
Salaries and Wages Expense 168,000
Advertising Expense 21,700
Utilities Expense 11,400
Depreciation Expense-Building 9,000
Repairs Expense 8,850
Depreciation Expense-Equipment 4,500
Insurance Expense 3,000
Supplies Expense 2,250
Miscellaneous Expense 4,350
Sarah Colin, Capital 169,450

31 Sarah Colin, Capital 10,000

Sarah Colin, Drawing 10,000

(5) Post-Closing Trial Balance

BEACONS COMPANY
Post-closing Trial Balance
December 31. 2019
Cash 13,000 -
Accounts receivable 53,000 -
Prepaid insurance 1,200 -
Supplies 750 -
Land 98,000 -
Building 500,000 -
Accumulated depreciation-building - 264,300
Equipment 121,900 -
Accumulated depreciation-equipment - 104,600
Accounts payable - 15,700
Salaries & wages payable - 4,900
Unearned rent - 800
Sarah Colin, Capital - 397,550
787,850 787,850