From the Following Items in the Income Statement Columns of the Worksheet

question 53

Essay

From the following items in the income statement columns of the worksheet of Bob's Barbershop at December 31, prepare the closing entries without explanation, assuming that a $500 withdrawal was made during the period.
$$\begin{array}{l}\text { Income Statement }\\\begin{array} { l r r } \text { Account } & \text { Debit } & \text { Credit } \\\text { Cutting Fees } & & 1,725 \\\text { Wages Expense } & 350 & \\\text { Rent Expense } & 300 & \\\text { Supplies Expense } & 225 & \\\text { Insurance Expense } & 125 & \overline { 1,725 } \\\text { } & 1,000 & \\\text { Net Income } & 725 & \underline { } \\& \underline { \underline { 1,725 } } & \underline { \underline { 1,725 } }\end{array}\end{array}$$

---

Definitions:

Taxation

The process or system through which governments levy charges on citizens and corporate entities to finance government spending and various public expenditures.

Inflation

The increase in the general price level of goods and services, leading to a decline in purchasing ability.

Conservative Economists

Economists who advocate for minimal government intervention in the economy, emphasizing free-market principles and fiscal conservatism.

Spending Cuts

Reductions in government or organizational spending, often implemented to reduce deficits or allocate resources more efficiently.