Question

In: Accounting

The adjusted trial balance of AltaAlta Corporation at December 31 shows that sales revenue for the...

The adjusted trial balance of

AltaAlta

Corporation at December 31 shows that sales revenue for the year was

$ 550 comma 000$550,000

and other revenue was

$ 49 comma 000$49,000.

Cost of goods sold for that same period was

$ 305 comma 000$305,000​,

while other expenses totaled

$ 210 comma 000$210,000.

The corporation declared and paid dividends of

$ 20 comma 000$20,000

during the year. The balance of retained earnings before closing entries was

$ 460 comma 000$460,000.

Read the requirements

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.

1. Prepare the closing entries for​ revenues, expenses, and dividends for the year. ​(Record debits​ first, then credits. Exclude explanations from any journal​ entries.)

Begin by recording the entry to close out the revenue accounts.

Journal Entry

Date

Accounts

Debit

Credit

Dec

31

Close out the expense accounts.

Journal Entry

Date

Accounts

Debit

Credit

Dec

31

Close out the Dividends account.

Journal Entry

Date

Accounts

Debit

Credit

Dec

31

2. What was net income for the​ year?

Select the formula and enter the amounts to determine net income for the year.

-

=

Net Income

-

=

3. What is the ending balance of retained earnings after the closing entries are​ posted?

Select the formula and enter the amounts to determine the ending balance of retained earnings after the closing entries are posted.

Ending Retained

+

-

=

Earnings

+

-

=

Choose from any list or enter any number in the input fields and then continue to the next question.

Solutions

Expert Solution

  • [1] Closing Entries

Journal Entry

Date

Accounts

Debit

Credit

Dec

31

Sales Revenue

$550,000

Other revenue

$49,000

Retained Earnings

$599,000

(to close revenue)

Journal Entry

Date

Accounts

Debit

Credit

Dec

31

Retained earnings

$515,000

Cost of Goods Sold

$305,000

Other expenses

$210,000

Close out the expense accounts.

Journal Entry

Date

Accounts

Debit

Credit

Dec

31

Retained earnings

$20,000

Dividends

$20,000

Close out the Dividends account.

  • [2] Net Income

Total Revenues

-

Total Expenses

=

Net Income

$599,000

-

$515,000

=

$84,000

  • [3]

Beginning Retained Earnings balance

+

Net Income

-

Dividends

=

Ending Retained Earnings

$460,000

+

$84,000

-

$20,000

=

$524,000


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