Identify Which of the Following Accounts Should Be Closed to Income

question 107

Essay

Identify which of the following accounts should be closed to Income Summary at the end of the fiscal year. Record next to each account:
a (Y) for YES, it should be closed to Income Summary; OR
an (N) for NO, it would not be closed to Income Summary.
1. Utilities Payable
2. Utilities Expense
3. Supplies
4. Supplies Expense
5. Fees Earned
6. Unearned Fees
7. Accounts Receivable
8. Dividends
9. Retained Earnings
10. Accumulated Depreciation - Equipment
11. Depreciation Expense - Equipment
12. Equipment
13. Prepaid Insurance
14. Insurance Expense

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Definitions:

Negotiable Instrument

A financial document providing assurance for the payment of a given amount of money, either to be paid on demand or at an agreed time, with the document containing the name of the payee.

Writing Requirement

A legal condition under certain laws requiring certain contracts to be in writing to be enforceable.

Order Instrument

A financial document that is payable to a specific person or entity, as named or endorsed on the instrument.

Specific Payee

A person or entity named in a negotiable instrument to whom or to whose order the money is directed to be paid.