Question

Indicate the account(s) to be debited and credited in each closing entry.

A. Cash in bank
B. Accounts receivable
C. Computer equipment
D. Accounts payable
E. Mariko Hays, capital
F. Mariko Hays, withdrawals
G. Income Summary
H. Fees
I. Miscellaneous expense
J. Rent expense
K. Supplies expense
L. Utilities expense

Answer 1

In closing entries, certain accounts need to be debited and credited to close out temporary accounts. The accounts to be debited and credited depend on the type of account. Accounts like Mariko Hays, capital and income summary are closed using specific debits and credits, while accounts like cash in bank, accounts receivable, and computer equipment do not require closing entries.

Step-by-step explanation:

When recording closing entries, you need to debit and credit the appropriate accounts to close out temporary accounts and transfer their balances to permanent accounts. The following are the accounts to be debited and credited in each closing entry:

1. To close the income summary account, you will debit income summary and credit fees (for revenues) and miscellaneous expense, rent expense, supplies expense, and utilities expense (for expenses).
3. To close the Mariko Hays, capital account, you will debit Mariko Hays, capital and credit income summary (for the net income or loss) and Mariko Hays, withdrawals (for any withdrawals made by Mariko Hays).
5. If there are any amounts in the temporary accounts such as cash in bank, accounts receivable, or computer equipment, you do not need to close them as they are already permanent accounts and do not reset at the beginning of each accounting period.