A company had revenues of $75,000 and expenses of $62,000 for the accounting period. Dividends of $8,000 were paid in cash during the same period. Which of the following entries could not be a closing entry? a. a debit to the Income Summary and a credit to the Owner's Capital for $13,000

b. a debit to the Income Summary and a credit to the Revenues account for $75,000

c. a debit to the Revenues and a credit to the Income Summary account for $75,000

d. a debit to the Income Summary and a credit to the Expenses for $62,000

e. all of these are possible closing entries

Question

Business

Izabella Carson

2 September, 07:47

A company had revenues of $75,000 and expenses of $62,000 for the accounting period. Dividends of $8,000 were paid in cash during the same period. Which of the following entries could not be a closing entry? a. a debit to the Income Summary and a credit to the Owner's Capital for $13,000

b. a debit to the Income Summary and a credit to the Revenues account for $75,000

c. a debit to the Revenues and a credit to the Income Summary account for $75,000

d. a debit to the Income Summary and a credit to the Expenses for $62,000

e. all of these are possible closing entries

+3

Answers (1)

Know the Answer?

Weston Stafford · Answer 1

b. a debit to the Income Summary and a credit to the Revenues account for $75,000

Explanation:

As we know that

The closing entries are shown below:

1. Sales Revenue A/c Dr $75,000

To Income Summary A/c $75,000

(Being revenue account closed)

2. Income summary A/c Dr $62,000

To Expenses A/c $62,000

(Being the expenses accounts are closed)

3. Income summary A/c Dr $13,000 ($75,000 - $62,000)

To Owner's capital $13,000

(Being the difference is credited to owners capital)