Question

Below the Adjusted Trial Balance for Torr's Towing Services is given.

Using the Adjusted Trial Balance prepare the closing entries at June 30, 2019 (on a piece of paper) and select the correct answer to the questions asked about the closing entries.

	TORR'S TOWING SERVICES
	WORKSHEET
	FOR THE YEAR ENDED JUNE 30, 2019
		ADJUSTED TRIAL BALANCE
ACCOUNT TITLES		DEBIT ($)	CREDIT ($)
Cash		56,820.00
Accounts Receivable		28,200.00
Towing Supplies		9,000.00
Notes Receivable		2,500.00
Land		180,000.00
Vehicles		66,000.00
Accumulated depreciation -
Vehicles			60,000.00
Accounts Payable			31,100.00
Unearned Revenue			1,400.00
Notes Payable			20,000.00
Capital - Torr Tait			205,500.00
Withdrawals - Torr Tait		3,000.00
Towing Service Revenue			143,500.00
Rent Revenue			28,000.00
Advertising Expense		3,500.00
Insurance Expense		1,200.00
Internet Expense		1,160.00
Meals and Entertainment Expense		2,500.00
Telephone Expense		1,120.00
Utilities Expense		10,800.00
Wage Expense		121,750.00
Depreciation - Vehicles		7,200.00
Interest Expense		400.00
Supplies Expense		9,000.00
Interest Payable			400.00
Wages Payable			14,250.00
		504,150.00	504,150.00

What is the journal entry to close out the Withdrawal's account?	Answer 1Choose...$12,870 Credit$171,500 Credit$12,870 DebitTemporary Account$171,500 Debit$158,630 Debit$143,500 Credit$172,900 CreditRevenue AccountDr. Withdrawals $3,000 Cr. Capital $3,000No entry required$151,430 DebitPermanent AccountDr. Capital $3,000 Cr. Withdrawals $3,000
What is the total amount posted to the Income Summary account to close out the revenue account(s)?	Answer 2Choose...$12,870 Credit$171,500 Credit$12,870 DebitTemporary Account$171,500 Debit$158,630 Debit$143,500 Credit$172,900 CreditRevenue AccountDr. Withdrawals $3,000 Cr. Capital $3,000No entry required$151,430 DebitPermanent AccountDr. Capital $3,000 Cr. Withdrawals $3,000
What is the total amount posted to the Owners' Capital account to close out the Income Summary account?	Answer 3Choose...$12,870 Credit$171,500 Credit$12,870 DebitTemporary Account$171,500 Debit$158,630 Debit$143,500 Credit$172,900 CreditRevenue AccountDr. Withdrawals $3,000 Cr. Capital $3,000No entry required$151,430 DebitPermanent AccountDr. Capital $3,000 Cr. Withdrawals $3,000
What type of account is the Income Summary account?	Answer 4Choose...$12,870 Credit$171,500 Credit$12,870 DebitTemporary Account$171,500 Debit$158,630 Debit$143,500 Credit$172,900 CreditRevenue AccountDr. Withdrawals $3,000 Cr. Capital $3,000No entry required$151,430 DebitPermanent AccountDr. Capital $3,000 Cr. Withdrawals $3,000
What is the total amount posted to the Income Summary account to close out the expense accounts?	Answer 5Choose...$12,870 Credit$171,500 Credit$12,870 DebitTemporary Account$171,500 Debit$158,630 Debit$143,500 Credit$172,900 CreditRevenue AccountDr. Withdrawals $3,000 Cr. Capital $3,000No entry required$151,430 DebitPermanent AccountDr. Capital $3,000 Cr. Withdrawals $3,000

Answer 1

Please refer the following image for the solution: