Question
Crimson Tide Music Academy offers lessons in playing a wide range of musical instruments. The unadjusted trial balance as of December 31, 2018, appears below.
Crimson Tide Music Academy offers lessons in playing a wide range of musical instruments. The unadjusted trial balance as of December 31, 2018, appears below. December 31 is the company's fiscal year-end.
Accounts | Debits | Credits | ||||
Cash | $ | 10,300 | ||||
Accounts Receivable | 9,500 | |||||
Supplies | 2,000 | |||||
Prepaid Rent | 7,200 | |||||
Equipment | 90,000 | |||||
Accumulated Depreciation | $ | 12,000 | ||||
Accounts Payable | 7,700 | |||||
Salaries Payable | 0 | |||||
Interest Payable | 0 | |||||
Utilities Payable | 0 | |||||
Notes Payable | 20,000 | |||||
Common Stock | 45,000 | |||||
Retained Earnings | 19,000 | |||||
Service Revenue | 42,200 | |||||
Salaries Expense | 24,500 | |||||
Interest Expense | 0 | |||||
Rent Expense | 0 | |||||
Supplies Expense | 0 | |||||
Utilities Expense | 2,400 | |||||
Depreciation Expense | 0 | |||||
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Totals | $ | 145,900 | $ | 145,900 | ||
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Information necessary to prepare the year-end adjusting entries appears below.
a. Depreciation of equipment for the year is $6,000.
b. Accrued salaries at year-end should be $2,100.
c. Crimson Tide borrows $20,000 on September 1, 2018. The principal is due to be repaid in four years. Interest is payable each August 31 at an annual rate of 12%.
d. Unused supplies at year-end total $700. Crimson Tide debits Supplies at the time supplies are purchased.
e. Crimson Tide opens a second studio by paying for one year of rent in advance on April 1, 2018, for $7,200 ($600 per month) debiting Prepaid Rent.
f. Unpaid utilities for December total $200.
Question: Record closing entries.
Journal entry worksheet
Record the entry to close the revenue accounts.
Note: Enter debits before credits.
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