Question

The following selected information is for Oriole Company for the year ended January 31, 2021: prepare closing entries

Freight in		$6,500		Purchase discounts		$12,000
Freight out		7,100		Purchase returns and allowances		16,300
Insurance expense		12,000		Rent expense		20,500
Interest expense		6,000		Salaries expense		60,800
Merchandise inventory, beginning		61,300		Salaries payable		2,500
Merchandise inventory, ending		42,000		Sales		322,000
O. G. Pogo, capital		105,000		Sales discounts		14,000
O. G. Pogo, drawings		42,400		Sales returns and allowances		20,400
Purchases		213,000		Unearned sales revenue		4,500

Answer 1

Closing Entries
Date	Account Titles and Explanation	Debit	Credit
Jan. 31, 2021	Sales	$322,000
	Purchase Discounts	$12,000
	Purchase returns and allowances	$16,300
	Income Summary		$350,300
	(To close the revenue accounts along with contra accounts)
Jan. 31, 2021	Income Summary	$360,300
	Freight-in		$6,500
	Freight-out		$7,100
	Insurance expense		$12,000
	Interest expense		$6,000
	Purchases		$213,000
	Rent expense		$20,500
	Salaries expense		$60,800
	Sales discounts		$14,000
	Sales returns and allowances		$20,400
	(To close the expense accounts)
Jan. 31, 2021	Retained Earnings	$10,000
	Income Summary ($360,300 - $350,300)		$10,000
	(To close income summary to retained earnings with loss)