Explanation Journalizing: Journalizing is the process of recording the transactions of an organization in a chronological order. Based on these journal entries recorded, the accounts are posted to the relevant ledger accounts. Accounting rules for journal entries: To increase balance of the account: Debit assets, expenses, losses and credit all liabilities, capital, revenue and gains. To decrease balance of the account: Credit assets, expenses, losses and debit all liabilities, capital, revenue and gains. Recording closing entry for expense accounts: Date Account Title and Explanation Post Ref. Debit($) Credit($) Income summary 57,515 Salaries expense 4,800 Artist fee expense 22,420 Rent expense 21,675 Advertising expense 4,500 Legal expense 1,200 Interest expense 375 Supplies expense 1,150 Insurance expense 600 Depreciation expense 360 Utilities expense 435 (to record closing of expense accounts) Table (1) Since income summary is a temporary income account, temporary income is decreased. Hence, income summary account is debited. Since salaries expense is an expense, expense is decreased...

4th Edition

ISBN: 9781337690881

Author: Jay Rich, Jeff Jones

Publisher: Cengage Learning

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Chapter 3, Problem 81.7C

To determine

To prepare: Closing entries.

Introduction: Closing entries are posted to close all the temporary accounts of the accounting books. Closing entries zeros the balances of income statement items, drawings, and dividends.

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Chapter 3, Problem 81.6C

Chapter 4, Problem 1DQ

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Current Attempt in Progress You have been asked to help the local commercial radio station prepare its business plan for the upcoming year. The radio station operates for 18 hours a day (6 a.m. to midnight) seven days a week, all year. It broadcasts on average 15 minutes of on-air advertising per hour. To sell the advertising time, the station uses commissioned sales staff who are paid a base salary plus commission that varies according to the volume of sales. The station manager asks you to calculate how many hours of advertising it would need to sell in order to break even. (a) Select the fixed costs and the variable costs. Rent • Utilities (heat, light, water) Property and business taxes Management salaries and benefits Marketing costs for the station • Sales force base salaries Costs of production of on-air commercial • Advertising sales commission

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Chapter 3 Solutions

Cornerstones of Financial Accounting

Ch. 3 - How does accural-basis net income differ from...Ch. 3 - Explain when revenue may be recognized and give an...Ch. 3 - What happens during the accounting cycle?Ch. 3 - Prob. 4DQ Ch. 3 - Why are adjusting entries needed?Ch. 3 - What accounting concepts require that adjusting...Ch. 3 - Prob. 7DQ Ch. 3 - Prob. 8DQ Ch. 3 - What is the difference between an accural and a...Ch. 3 - Prob. 10DQ

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Closing entries. Introduction: Closing entries are posted to close all the temporary accounts of the accounting books. Closing entries zeros the balances of income statement items, drawings, and dividends.

Solution Summary: The author explains the process of journalizing, which involves recording the transactions of an organization in a chronological order.

To prepare: Closing entries. Introduction: Closing entries are posted to close all the temporary accounts of the accounting books. Closing entries zeros the balances of income statement items, drawings, and dividends.

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Chapter 3 Solutions

To prepare: Closing entries.

Introduction: Closing entries are posted to close all the temporary accounts of the accounting books. Closing entries zeros the balances of income statement items, drawings, and dividends.