Economic Research Associates, owned by Paul Harris, is retained by large companies to test consumer reaction to new products. On January 31, 2013, the firm's worksheet showed the following adjustments data: (a) supplies used, $2,240; (b) expired rent, $12,000; and (c) depreciation on office equipment, $4,480. The balances of the revenue and expense accounts listed in the Income Statement section of the worksheet and the drawing account listed in the Balance Sheet section of the worksheet are given below:
REVENUE AND EXPENSE ACCOUNTS
401 Fees Income.......................................$90,000 Cr.
511 Depr. Expense-Office Equipment..............4,480 Dr.
514 Rent Expense......................................12,000 Dr.
517 Salaries Expense..................................48,500 Dr.
520 Supplies Expense...................................2,240 Dr.
523 Telephone Expense.................................1,250 Dr.
526 Travel Expense....................................10,290 Dr.
529 Utilities Expense....................................1,150 Dr.
DRAWING ACCOUNT
302 Paul Harris, Drawing.............................10,000 Dr.
INSTRUCTIONS
1. Record the adjusting entries in the general journal, page 3.
2. Record the closing entries in the general journal, page 4.
Analyze:
What closing entry is required to close a drawing account?