Prepare a closing journal entry for the income statement accounts, assumingthe events on December 29-31 were the only transactions to affect incomestatement accounts. Record the transaction.Note: Enter debits before credits.DateGeneral JournalDebitCreditDecember31Clear entryView general journalRecord entry American Laser, Incorporated, reported the following account balances on January 1.CreditDebit$ 5,000Accounts ReceivableAccumulated DepreciationAdditional Paid-in Capital$ 30,00090,0002,0000Allowance for Doubtful AccountsBonds PayableBuildings247,00010,000CashCommon Stock, 10,000 shares of $1 par10,00010,000Notes Payable (long-term)120,000Retained EarningsTreasury Stock0TOTALS$ 262,000 $ 262,000The company entered into the following transactions during the year.January 15 Issued 5,000 shares of $1 par common stock for $50,000 cash.January 31 Collected $3,000 from customers on account.February 15 Reacquired 3,000 shares of $1 par common stock into treasury for $33,000 cash.March 15 Reissued 2,000 shares of treasury stock for $24,000 cash.August 15 Reissued 600 shares of treasury stock for $4,600 cash.September 15 Declared (but did not yet pay) a $1 cash dividend on each outstanding share of common stock.October 1 Issued 100, 10-year, $1,000 bonds, at a quoted bond price of 101.October 3 Wrote off a $1,500 balance due from a customer who went bankrupt.December 29 Recorded $230,000 of service revenue, all of which was collected in cash.December 30 Paid $200,000 cash for this year's wages through December 31. Ignore payroll taxes and payroll deductions.December 31 Calculated $10,000 of depreciation for the year to be recorded. (Ignore accrual adjustments for interest and incometaxes.)

While preparing closing Entry for Income statement accounts, all the Revenues and Expenses are…

October 3 Wrote off a $1,500 balance due from a customer who went bankrupt. December 29 Recorded $230,000 of service revenue, all of which was collected in cash. December 30 Paid $200,000 cash for this year's wages through December 31. Ignore payroll taxes and payroll deductions. December 31 Calculated $10,000 of depreciation for the year to be recorded. (Ignore accrual adjustments for interest and income taxes.)

October 3 Wrote off a $1,500 balance due from a customer who went bankrupt. December 29 Recorded $230,000 of service revenue, all of which was collected in cash. December 30 Paid $200,000 cash for this year's wages through December 31. Ignore payroll taxes and payroll deductions. December 31 Calculated $10,000 of depreciation for the year to be recorded. (Ignore accrual adjustments for interest and income taxes.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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C8
! Required information [The following information applies to the questions displayed below.] At year-end December 31, Chan Company estimates its bad debts as 0.30% of its annual credit sales of $812,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $406 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Determine the impact of the December 31, February 1, and June 5 transactions on the accounting equation. For each transaction, indicate whether there would be an increase, decrease, or no effect, for Assets, Liabilities, and Equity. Note: Leave no cells blank. December 31 February 1 June 5 Assets Liabilities Equity