Prepare Closing Entries for December from the Following Income Statement $\quad$

question 39

Essay

Prepare closing entries for December from the following Income Statement columns of the work sheet of Custom Cleaning Service,Inc.,assuming that a $500 dividend was paid during the period (omit explanations).
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text {Income Statement }$
$\begin{array}{|l|r|r|}\hline&\text { Debit }& \text { Credit }\\ \hline \text { Cleaning Revenue } & & 2,600 \\\hline \text { Wages Expense } & 1,200 & \\\hline \text { Rent Expense } & 400 & \\\hline \text { Supplies Expense } & 300 & \\\hline \text { Income Taxes Expense } & 40 & \\\hline & 1,940 & 2,600 \\ \text { Net Income } & 660 & \\\hline & 2,600 & 2,600 \\\hline \end{array}$

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Definitions:

Discount Rate

In discounted cash flow analysis, this is the rate used to ascertain the present worth of cash flows expected in the future.

Tax Rate

The tax imposition rate on the financial gains of individuals and corporations.

Machinery

Tools, equipment, and devices that perform various tasks in the production process, often indicating the fixed assets used in manufacturing or production.

Equipment

Tangible items purchased for use in the production or supply of goods and services, not intended for sale as part of regular operations.