question archive Nix'it Company's ledger on July 21, it's fiscal year-end, includes the following selected accounts that have normal balances (Nix'it uses the perpetual inventory system Merchandise inventory $ 39,300 T
Nix'it Company's ledger on July 21, it's fiscal year-end, includes the following selected accounts that have normal balances (Nix'it uses the perpetual inventory system Merchandise inventory $ 39,300 T
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Nix'it Company's ledger on July 21, it's fiscal year-end, includes the following selected accounts that have normal balances (Nix'it uses the perpetual inventory system
Merchandise inventory $ 39,300
T. Nix, Capital $118,300
T. Nix Withdrawals $7,000
Sales $159,600
Sales discounts $3,200
Sales returns and allowances $6,200
Cost of goods sold $105,900
Depreciation expense $10,600
Salaries expense $34,000
Miscellaneous expenses $5,000
Record the entry to close the income statement accounts with debit balances.
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The closing entries are done for temporary revenue and expenses accounts. Another temporary accounts that is closed is the Withdrawals. The revenue and expenses accounts are first closed
a). To close the income statement accounts with credit balances (Revenue accounts):
Debit, Sales and Credit, Income summary by $159,600
b). To close the income statement accounts with debit balances (Total expenses=$164,900):
Debit, Income summary and Credit, expenses account
c). To close the income summary balance( $159,600-$164,900=$5,300)
Debit, T. Nix, Capital and Credit, Income summary by $5,300
d). To close the drawings accounts
Debit, T. Nix, Capital and Credit, T. Nix Withdrawals by $7,000
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