1. A business has the following account balances on February 31, 2020, after posting all adjusting entries.All accounts have normal balances.

Account Balance Cost of goods sold77,700 Amortization expense15,800Drawings29,700 Interest expense10,800 Rent revenue25,400 Kwantlen, capital, Mar. 1, 2019128,400 Prepaid rent2,400 Advertising expense5,100 Wage expense54,300 Sales194,200 Sales returns and discounts5,700 Unearned rent4,900

When the closing entry is prepared for temporary accounts with credit balances, Income Summary will be:

debited for $219,600

credited for $227,500

debited for $194,200

credited for $219,600

When the closing entry is prepared for temporary accounts with debit balances, Income Summary will be

debited for $169,400

debited for $91,700

debited for $163,700

debited for $164,500

When Income Summary is closed to Owner's Capital, Income Summary will be:

credited for $50,200

credited for $25,100

debited for $24,800

credited for $55,900

Once closing entries are posted, the ending balance in Owner's Capital will be:

$130,500

$132,600

$162,100

$148,900

2) A business has the following account balances on December 31, 2020, after posting all adjusting entries.All accounts have normal balances.

Account

Balance

Accounts Payable

325

Accumulated depreciation, Equipment

4,400

Cash

1,170

Depreciation expense

950

Drawings

4,800

Insurance expense

400

Equipment

20,600

Revenue

21,720

Supplies

1,930

Owner's Capital

11,125

Prepaid Insurance

600

Salaries expense

8,120

Unearned Revenue

1,000

When closing entries are prepared, Drawings:

will not affect Owner's Capital

will be presented on the balance sheet

will be debited for $4,800

will be credited for $4,800

When closing entries are prepared, Unearned Revenue

will increase Income Summary

will not affect Income Summary

will be credited for $1,000

will be debited for $1,000

When Income Summary is closed to Owner's Capital, Income Summary will be:

credited for $9,470

debited for $12,250

debited for $21,720

credited for $12,250

Once closing entries are prepared, the balance in Owner's Capital will be:

Credit $18,575

Credit $20,595

Credit $11,125

Credit $23,375