The Appropriate Format of the December 31, 2012 Closing Entry

question 34

Multiple Choice

The appropriate format of the December 31, 2012 closing entry for John & Hope Limited Liability Partnership, whose two partners had withdrawn their salaries from the partnership during the year is: $$\begin{array} { | l | l | r | r | } \hline \text { A) } & \text { John, Drawing } & \text { XXX } & \\\hline & \text { Hope, Drawing } & \text { XXX } & \\\hline & \text { Salaries Payable } & & \text { XXX } \\\hline \text { B) } & \text { Salaries Expense } & \text { XXX } & \\\hline & \text { John, Drawing } & & \text { XXX } \\\hline & \text { Hope, Drawing } & & \text { XXX } \\\hline \text { C) } & \text { John, Capital } & \text { XXX } & \\\hline & \text { Hope, Capital } & \text { XXX } & \\\hline & \text { Salaries Payable } & & \text { XXX } \\\hline \text { D) } & \text { John, Capital } & \text { XXX } & \\\hline & \text { Hope, Capital } & \text { XXX } & \\\hline & \text { John, Drawing } & & \text { XXX } \\\hline & \text { Hope, Drawing } & & \text { XXX } \\\hline\end{array}$$

• A)Option A
• B)Option B
• C)Option C
• D)Option D
• E)Option E

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Definitions:

Continuous Compounding

The process of calculating interest and reinvesting it into an account continuously, generating earnings on both the initial principal and the accumulated interest.

Retirement Fund

A financial reserve that accumulates through savings and investments, intended to support individuals financially during their retirement years.

Compounded Monthly

Interest calculation method where interest is added to the principal sum at the end of each month, and future interest is calculated on the new total.