Question

Exercise 3-14 Presented below is information related to Pronghorn Corporation for the month of January 2017. Cost of goods sold $192,390 Salaries and wages expense $65,800 Delivery expense 7,620 Sales discounts 8,440 Insurance expense 11,850 Sales returns and allowances 12,030 Rent expense 18,830 Sales revenue 319,900 Prepare the necessary closing 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 0 for the amounts.)

Answer 1

Step-by-step explanation:

The closing entry for the following accounts are shown below:

1. Sales Revenue A/c Dr $319,900

To Income Summary $319,900

(Being revenue account closed)

2. Income summary A/c Dr $316,960

To Cost of goods sold $192,390

To Delivery Expense $7,620

To Salaries and Wages Expense $65,800

To Insurance Expense $11,850

To Sales returns and allowances $12,030

To Rent Expense $18,830

To Sales discounts $8,440

(Being expenses accounts are closed)

3. Income summary A/c Dr $2,940 ($319,900 - $316,960)

To Retained earning $2,940

(Being the difference is credited to retained earning)