On the Basis of the Following Data Taken from the Adjusted

question 3

Essay

On the basis of the following data taken from the adjusted trial balance columns of the worksheet for the year ended December 31 for Painting the Perfect Picture,journalize the four closing entries in the proper order.
$$\begin{array} { l l l } \text { Account } & \text { Debit } & \text { Credit } \\\text { Cash } & 20,000 & \\\text { Accounts Receivable } & 67,000 & \\\text { Supplies } & 7,000 & \\\text { Equipment } & 200,000 \\\text { Accumulated Depreciation } & & 70,000 \\\text { Accounts Payable } & & 30,000 \\\text { Capital } & & 200,250 \\\text { Withdrawals } & 25,000 & \\\text { Fees Earned } & &100,000 \\\text { Salary Expense } & 27,000 & \\\text { Rent Expense } & 17,500 & \\\text { Depreciation Expense } & 20,000 & \\\text { Supplies Expense } & 12,500 & \\\text { Miscellaneous Expense } & 4,250 & \\\text { Total } & \underline { 400,250 } & \underline { 400,250 }\\\end{array}$$

---

Definitions:

Mark-Up Percentage

The percentage added to the cost price of goods to cover overhead and profit.

Total Variable Cost

The aggregate of all variable costs that are incurred for a particular level of output or production.

Total Annual Fixed Costs

The sum of all business expenses that are constant and do not change with the level of production within the year.

Profit Maximising Model

A theoretical framework or strategy aimed at increasing a firm’s profits to the highest possible level.