ACCT 201 at Towson University

18. Year End Closing & Account Classification

in Topic 4 (Problem 18 of 18)
1. Total assets - 831
2. Total liabilities - 145
3. What are retained earnings on the Dec. 31, Year 1 balance sheet? - 586

4. Closing the Income Summary Accounts:

Step 1: Close revenue and expenses to Income Summary

Income Summary
Depreciation Expense 60
855 Sales Revenue
COGS 420
Interest Expense 4
Rent 40
Salary Expense 125
206 Net Income

Step 2: Close Income Summary and Dividends to RE

Retained Earnings
400 Opening Balance
206 Income Summary
Dividends 20
586 Ending Balance
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Topic 4 Videos

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