Answered: Castillo Services paid K. Castillo, the…

Castillo Services paid K. Castillo, the sole shareholder of Castillo Services, $6,000 in dividends during the current year. The entry to close the dividends account at the end of the year is:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Turner Company owns 35% of the outstanding stock of ICA Company. During the current y its common…

A: Financial statements are created in line with accounting rules and laws, and they give a detailed…

Q: Sahali Corp. issued 1,000,000 common shares at $7 a share during April Year 1. On September 23, Year…

A: The shares being repurchased are recorded in the treasury stock.

Q: What is the maximum amount which could be included in Aurora Company's income before fax to reflect…

A: A holding of 20% or more of the voting power (directly or through subsidiaries) will indicate…

Q: On January 2. Year 1, Barber Company purchased 6,100 shares of Convell Company for $71,720. Convell…

A: Number of Share purchases of Convell Company 6100 Shares Total Number of Share outstanding of…

Q: On October 1, A company acquired for cash all the outstanding ordinary shares of B company. Both…

A: In case one company overtake the assets and liabilities of another company , then accounting for…

Q: a) Determine the amount of each distribution that is from current E&P, accumulated E&P, Return of…

A: SOLUTION;- JANUARY 01- IMAGINE NATION CORPORATION HAD ACCUMULATED EARNING&PROFITS - 50000$…

Q: r corporation has 1,000 shares of common stock outstanding, 200 of which are owned by doug. on june…

A: Redemption means company company buy its own share from shareholders.

Q: On January 1, 2021, an investor company acquired 25% of an investee company's common stock for…

A: Equity Investment Account: Investment in equity investment refers to the amount of money a person…

Q: purchased another 300 shares of Semi-Tech for $7,200 and s of the following ways will the loss on…

A: Adjusted cost base is the purchase price of the share adjusted by dividends, bonus, share splits…

Q: On January 4, Year 1, Barber Company purchased 13,500 shares of Convell Company for $162,000.…

A: Journal entry is the first stage of the accounting process.Journal entry is used to record business…

Q: FX Services granted 16.0 million of its $1 par common shares to executives, subject to forfeiture if…

A: The objective of this question is to determine the effect on earnings in the year after the shares…

Q: Peter Inc. purchases 30% of Sam Ltd for $50,000 with significant influence. At year-end, Peter Inc.…

A: Solution: Holding of peter Inc. in Sam ltd = 30% As Peter Inc holds more than 20% in Sam ltd,…

Q: On January 2, Todd Company acquired 40% of the outstanding stock of McGuire Company for $205,000.…

A: The journal entries are the basic method for recording transactions. The portion of shares acquired…

Q: Grouper Co. had purchased 190 shares of Washington Co. for $43 each this year (Oregon Co. does not…

A: Gain on sale of investment = sales value of investment Purchase cost of investment

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: Equity Method : The equity method in accounting is the technique of accounting for investments in…

Q: Bonneau Corporation declares a cash dividend of $100,000 on July 1 for any shareholder on record on…

A: Introduction: Dividends: Dividends are given to shareholders of the company. Dividends are part of…

Q: Hello! I need help with the following accounting problem: Bramble Inc. obtained significant…

A: The objective of the question is to prepare the necessary journal entries for Bramble Inc. for the…

Q: The following transactions relate to Brown Company’s long-term investments. Brown did not own any…

A: 09.09.2019, Purchased 1000 shares = $80000 cash Journal entry will be Investments Packard common…

Q: Dristell Incorporated had the following activities during the year (all transactions are for cash…

A: The investing activities section of the cash flow statement includes cash flows from non-current…

Q: arado, Inc. owns 30% of the outstanding shares of Tako Inc. common stock. During 2021, ako earns…

A: Lets understand the basics.When one entity have more than 20% of holding in another entity then both…

Q: On March 31, Pyramid Co. acquired 40% of the shares of Casting Co. Pyramid paid $3,000,000 for the…

A: Given information,Initial Investment: Pyramid's initial investment for a 40% share in Casting…

Q: Company A purchased 44% ($250,000) of Company b in common stock at an 8% discount. He paid $5,700 in…

A: while making calculation of investment in Company b , common stock will deducted by the discount…

Q: On January 1 of the current year, Rhondell Corporation has accumulated E & P of $36,000. Current E &…

A: Return on capital (ROC) measures a company's net income relative to the sum of its debt and equity…

Q: o Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported net…

A: This strategy is only employed when the investor has sufficient control over the investee. The…

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: The investment is reported as an asset in the balance sheet. The investment increases with the…

Q: Cullumber Co. had purchased 190 shares of Washington Co. for $37 each this year (Oregon Co. does not…

A: The journal entries are prepared to record the transactions on regular basis. The investment in…

Q: Bonneau Corporation declares a cash dividend of $100,000 on July 1 for any shareholder on record on…

A: The journal entries are prepared to keep the record of day to day transactions of the business on…

Q: On January 1, 2023, Kinney, Inc., an S corporation, reports $4,000 of accumulated E & P and a…

A: Accumulated adjustments account (AAA):It refers to a corporation's account that tracks adjustments…

Q: Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported…

A: Dividend is the reward given to the shareholders in the form of shares, cash or other.The retained…

Q: NSYNC Realty, Incorporated, has been operating for three years and is owned by three investors. JC…

A: Income statement is a financial statement that shows profitability, total revenue and total…

Q: In the current year, a company entered into the transactions described below. Three years prior, the…

A: Shares repurchase is a transaction where common shares are purchased and cancelled by the…

Q: On January 1, 2023, Kinney, Inc., an S corporation, reports $33,600 of accumulated E & P and a…

A: Accumulated adjustments account (AAA): It refers to a corporation's account that tracks adjustments…

Q: Sharon Slotten purchased shares in ATCO Ltd. during the current year as follows: Jan. 1: 200 shares…

A: Sharon's Taxable Capital Gain CalculationStep 1: Identify Shares Sold on December 22ndWe need to…

Q: Sapphire Jewellery Pty Ltd (SJ) is a resident private company. During the 2023 income year, SJ…

A: A capital gain on the sale of shares occurs when an individual or entity, as the case may be, sells…

Q: Concord Corporation purchased 360 shares of Sherman Inc. common stock for $11,900 (Concord does not…

A: Fair Value through Other Comprehensive Income (FVOCI) is an accounting method used to classify…

Q: Shamrock Co. had purchased 230 shares of Washington Co. for $37 each this year (Oregon Co. does not…

A: Step 1:Journal entry as follows : No.Account titles and…

Q: Determine the allocation of the distributions by completing the table below. Assume that the…

A: SOLUTION:- Particulars in $ Accumulated E&P $174,000 Current E&P $522,000 Total…

Q: WRT, a calendar year S corporation, has 100 shares of outstanding stock. At the beginning of the…

A: Many companies pay cash to shareholders in the form of a dividend. Shareholders receive a dividend…

Q: Home Realty, Incorporated, has been operating for three years and is owned by three Investors. J.…

A: Income Statement: It refers to one of the financial statements that presents or shows all of the…

Q: During the year, Miles Nutt, the sole shareholder of a calendar year S corporation, received a…

A: Explanation:Stock Basis Adjustment:Miles Nutt had a stock basis of $4,000 at the beginning of the…

Q: First Link Services granted 5.8 million of its $1 par common shares to executives, subject to…

A: In the given case, the fair value of the stock to be granted is determined. Then a contra entry is…

Question

Multiple Choice
Debit Retained earnings $6,000; credit Dividends $6,000
Debit Dividends $6,000; credit Cash, $6,000
Debit Dividends $6,000; credit Retained earnings $6,000
Debit Income Summary $6,000; credit Retained earnings $6,000
Debit Retained earnings $6,000; credit Salary Expense $6,000
20
Noxt

Castillo Services paid K. Castillo, the sole shareholder of Castillo Services, $6,000 in dividends during the current year. The entry to close the
dividends account at the end of the year is:
Multiple Choice
Debit Retained earnings $6.000; credit Dividends $6,000
Debit Dividends $6,000; credit Cash, $6,000
Debit Dividends $6.000, credit Retained earnings $6,000
Dehit Incnme Summan $6 000credit Retained earninge C6000
Ac
Graw
Hill
< Prev
25 of 30
Next >
Type here to search
8:59
99%
2/21/2

Expert Solution

Step 1

Solution:

Closing entries are prepared at the end of accounting period to close temporary accounts to income summary or retained earnings.

Temporary accounts are those accounts that are not carried to next accounting period and same is not part of balance sheet.

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Sapphire Jewellery Pty Ltd (SJ) is a resident private company. During the 2023 income year, SJ recorded an accounting profit of $80,000 In addition to the transactions recorded in the financial statements, SJ noted the following: SJ sold shares held as an investment for $45,000. The shares were purchased in 2017 for $25,000 Calculate the taxable income of SJ for the 2023 income year. Question 18Select one: $ 100,000 $90,000 $60,000 $70,000
Sandhill Corporation purchased for $288,000 a 25% interest in Murphy, Inc. This investment enables Sandhill to exert significant influence over Murphy. During the year, Murphy earned net income of $173,000 and paid dividends of $54,000. Prepare Sandhill's journal entries related to this investment. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
On January 1, Larkspur Corporation purchased 35% of the outstanding shares of Selig Company for $239,400. At December 31, Selig declared and paid a $63,000 cash dividend and reported net income of $100,800. Prepare the necessary journal entries for Larkspur Corporation. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries. Recond journal entries in the order presented in the problem.) Date Account Titles and Explanation > (To record dividends received) (To record share of net income) Debit Credit
26 )
Bonneau Corporation declares a cash dividend of $100,000 on July 1 for any shareholder on record on July 15. The dividend will be paid on July 31. Journalize the entries required on each date.
evenues and R.O.28,800 in expenses. Mazaya issued ordinary share he year. The equity at the end of the year was
Pronghorn Corporation purchased for $ 322,000 a 30% interest in Murphy, Inc. This investment enables Pronghorn to exert significant influence over Murphy. During the year, Murphy earned net income of $ 183,000 and paid dividends of $ 60,000.Prepare Pronghorn’s journal entries related to this investment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit enter an account title to record the purchase enter a debit amount enter a credit amount enter an account title to record the purchase enter a debit amount enter a credit amount (To record the purchase.) enter an account title to record the net income enter a debit amount enter a credit amount enter an account title to record the net income enter a debit amount enter a credit amount (To record the…
James Company purchased 900 shares of POP Company's stock as a long-term investment for $57,600. Four years later, 320 shares were sold for $62 per share. What is the amount of gain or loss on the sale? (Enter a loss as a negative number using a minus sign.)
Dristell Incorporated had the following activities during the year (all transactions are for cash unless stated otherwise): a. A building with a book value of $419,000 was sold for $519,000. b. Additional common stock was issued for $179,000. c. Dristell purchased its own common stock as treasury stock at a cost of $84,500. d. Land was acquired by issuing a 6%, 10-year, $769,000 note payable to the seller. e. A dividend of $59,000 was paid to shareholders. f. An investment in Fleet Corporation's common stock was made for $139,000. g. New equipment was purchased for $74,500. h. A $99,500 note payable issued three years ago was paid in full. i. A loan for $119,000 was made to one of Dristell's suppliers. The supplier plans to repay Dristell this amount plus 10% interest within 18 months. Required: Calculate net cash flows from financing activities. (Cash outflows should be indicated with a minus sign.) DRISTELL INCORPORATED Statement of Cash Flows (partial) For the Year Ended December…
Scott Co. acquired a 30% interest in Roker, Inc. for $210,000 and appropriately applied the equity method. During the first year, Roker, Inc. reported net income of $125,000 and paid cash dividends totaling $25,000.What amount will Scott report as it relates to the investment at the end of the first year on its income statement? Select one: A. Investment earnings totaling $37,500 B. Investment earnings totaling $22,500 C. Receipt of dividends totaling $7,500 D. Net investment earnings totaling $75,000
Ramiro Company purchased 40% of the outstanding stock of Marco Company on January 1. Marco reported net income of $76,000 and declared dividends of $17,800 during the year. How much would Ramiro adjust its investment in Marco Company under the equity method? of $fill in the blank 2
On January 1, 2020, Kinney, Inc., an S corporation, reports $11,200 of accumulated E & P and a balance of $28,000 in AAA. Kinney has two shareholders, Erin and Frank, each of whom owns 500 shares of Kinney's stock. Kinney's nonseparately stated ordinary income for the year is $14,000. Kinney distributes $16,800 to each shareholder on July 1, and it distributes another $8,400 to each shareholder on December 21. How are the shareholders taxed on the distributions? Ignore the 20% QBI deduction. Do not round intermediate computations. If required, round your final answers to the nearest dollar. Erin and Frank each report $ 0 x dividend income for the July 1 distribution and $ 0 X each for the December 21 distribution. Assuming that the shareholders have sufficient basis in their stock, both Erin and Frank each receive a tax-free ✓ 0 X distribution from AAA.