Ask Question
10 December, 13:19

The following adjusted trial balance contains the accounts and year-end balances of Cruz Company as of December 31. No. Account Title Debit Credit 101 Cash $ 19,000 126 Supplies 13,000 128 Prepaid insurance 3,000 167 Equipment 24,000 168 Accumulated depreciation-Equipment $ 7,500 301 A. Cruz, Capital 47,600 302 A. Cruz, Withdrawals 7,000 404 Services revenue 44,000 612 Depreciation expense-Equipment 3,000 622 Salaries expense 22,000 637 Insurance expense 2,500 640 Rent expense 3,400 652 Supplies expense 2,200 Totals $ 99,100 $ 99,100 1. Prepare the December 31, closing entries for Cruz Company. Assume the account number for Income Summary is 901. 2. Prepare the December 31, post-closing trial balance for Cruz Company. Note: A. Cruz, Capital was $47,600 on December 31 of the prior year.

+5
Answers (1)
  1. 10 December, 13:44
    0
    Services revenue 44,000 debit

    Income Summary 44,000 credit

    --to close revenues accounts--

    Income Summary 33,100 debit

    Depreciation expense-Equipment 3,000 credit

    Salaries expense 22,000 credit

    Insurance expense 2,500 credit

    Rent expense 3,400 credit

    Supplies expense 2,200 credit

    --to close expenses account--

    Income Summary 7,000 debit

    A. Cruz, Withdrawals 7,000 credit

    --to close withdrawals account--

    Income summary 3,900 debit

    A. Cruz, Capital Account 3,900 credit

    --to close Income Summary against Cruz, capital account--

    Cash 19,000

    Supplies 13,000

    Prepaid insurance 3,000

    Equipment 24,000

    Accumulated depreciation-Equipment 7,500

    A. Cruz, Capital 51,500

    Totals 59,000 59,000

    Explanation:

    To close the accounting period we will use income summary to write off expenses, revenues and withdrawals account. Then, the balance of this account will be transfer into Cruz Capital Account

    income summary balance: 44,000 - 33,100 - 7,000 = 44,000 - 40,100 = 3,900

    Then we post the trial balance considering assets has debit balance while liabilities and equity credit.

    We check if everything is okay and it does. Debit = Credit
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “The following adjusted trial balance contains the accounts and year-end balances of Cruz Company as of December 31. No. Account Title Debit ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers