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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

If Income from Services had a $20,400 credit balance before closing entries, which of the following would be the appropriate closing entry to close revenues?

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To determine

Find the correct option, the option that indicates the correct entry for the closing of revenue.

Explanation

Closing entries: The journal entries prepared to close the temporary accounts to capital account are referred to as closing entries. The revenue, expense, and drawing accounts are referred to as temporary accounts because the information and figures in these accounts is held temporarily and consequently transferred to permanent account at the end of accounting year.

Prepare journal entry to close revenue to Income Summary account.

DateAccount Titles and ExplanationsPost. Ref.Debit ($)Credit ($)
  Income from ...

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