Question

Francis Real Estate Company has the following account balances at December 31, the end of its fiscal year. Debit Credit Commissions Earned....... $84,900 Wages Expense....... $36,000 Insurance Expense....... 1,900 Utilities Expense....... 8,200 Depreciation Expense....... 9,800 Retained Earnings....... 72,100 Assume that the company has not yet closed any accounts to retained earnings. Prepare journal entries to close the temporary accounts above. After these entries are posted, what is the balance of the Retained Earnings account

Answer 1

Dr Commissions earned 84,900

Cr Income summary 84,900

Dr Income summary 55,900

Cr Wages Expense 36,000

Cr Insurance Expense 1,900

Cr Utilities Expense 8,200

Cr Depreciation Expense 9,800

Dr Income summary 29,000

Cr Retained earnings 29,000

The balance of the retained earnings account is $101,100 after all temporary accounts have been closed.