Prepare the Necessary Closing Entries Based on the Following Selected

question 69

Essay

Prepare the necessary closing entries based on the following selected accounts. $\begin{array}{lr}\text { Accumulated Depreciation } & \$ 10,000 \\\text { Depreciation Expense } & 6,000 \\\text { Owner's Capital } & 20,000 \\\text { Owner's Drawings } & 9,000 \\\text { Salaries and Wages Expense } & 19,000 \\\text { Service Revenue } & 40,000\end{array}$

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Definitions:

Total Cost

The sum of all expenditures incurred by a business to produce and sell a product, including fixed and variable costs.

Average Total Costs

The total cost of production divided by the number of units produced, reflecting the average cost per unit of output.

Average Variable Costs

A new definition for the cost incurred from variable resources divided by the total output, illustrating the expense associated with producing each additional unit.

Total Fixed Costs

The total amount of expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.