Assume for each of the following independent cases that the annual accounting period ends on December 31, 2017, and that the total of all revenue accounts was $150,000 and the total of all expense accounts was $130,000.
Case A: Assume that the company is a sole proprietorship owned by Proprietor A. Prior to the closing entries, the Capital account reflected a credit balance of $50,000 and the Drawings account showed a balance of $8,000.
Case B: Assume that the company is a owned by Partner A and Partner B. Prior to the closing entries, the owners’ equity accounts reflected the following balances: A, Capital, $40,000; B, Capital, $38,000; A, Drawings, $5,000; and B, Drawings, $9,000. Profits and losses are divided equally.
Case C: Assume that the company is a corporation. Prior to the closing entries, the shareholders’ equity accounts showed the following:
Capital shares: par $10; authorized 30,00 shares; outstanding 15,000 shares
Contributed surplus: $5,000
Retained earnings: $65,000
Required:
1. Give all the closing entries required at December 31, 2017, for each of the separate cases.
2. Show how the equity section of the would appear at December 31, 2017, for each case. Show computations.
Enjoy 24/7 customer support for any queries or concerns you have.
Phone: +1 213 3772458
Email: support@gradeessays.com