Prepare closing entries for Year 1. T-accounts and trial balance

The following transactions apply to Jova Company for Year 1, the first year of operation: Issued $10,000 of common stock for cash. Recognized $210,000 of service revenue earned on account. Collected $162,000 from accounts receivable. Paid $125,000 cash for operating expenses. Adjusted the accounts to recognize uncollectible accounts expense. Jova uses the allowance method of accounting for uncollectible accounts and estimates that uncollectible accounts expense will be 1 percent of sales on account.