Question

The balance in the J. Jones, withdrawals account was $5,000. The entry to close the account would include a:

a. Debit to J. Jones, withdrawals for $5,000
b. Credit to J. Jones, withdrawals for $5,000
c. Debit to Capital for $5,000
d. Credit to Income Summary for $5,000

Answer 1

The entry to close J. Jones' withdrawal account with a $5,000 balance would be a credit to the account for $5,000, effectively zeroing the balance and reflecting the decrease in owner's equity.

Step-by-step explanation:

The student's question pertains to the process of closing an account in accounting. Specifically, J. Jones has a withdrawal account with a balance of $5,000 that needs to be closed. The correct entry to close this account would be to:

Debit to J. Jones, withdrawals for $5,000 (b). This will zero out the balance in the withdrawal account. As withdrawals are a debit to decrease the owner's equity, we need to credit this account to close it. The opposite entry, which is not discussed in the question, would be a credit to the owner's capital account, which shows the overall effect of the withdrawal on the owner's equity.