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Q 21QS

Financial & Managerial Accounting
Found in: Page 143
Financial & Managerial Accounting

Financial & Managerial Accounting

Book edition 7th
Author(s) John J Wild, Ken W. Shaw, Barbara Chiappetta
Pages 1096 pages
ISBN 9781259726705

Short Answer

The ledger of Mai Company includes the following accounts with normal balances: Common Stock,

$9,000; Dividends, $800; Services Revenue, $13,000; Wages Expense, $8,400; and Rent Expense, $1,600.

Prepare the necessary closing entries from the available information at December 31.


Journal entries in the books of Mai company are shown in step 2.

See the step by step solution

Step by Step Solution

Step-by-Step Solution

Step 1: Definition of wage expense

The expenses that occurred during the payment of wages is known as wage expense.

Step 2: Necessary closing entries

Journal entry





December 31

Income Summary


Rent Expense


Wage Expense


(Being closing entry of rent and wages)

December 31

Service Revenue


Income Summary


(Closing entry of service revenue)

December 31

Income Summary Retain Earning


Income summary


(Entry of profit)

December 31

Retained Earnings




(Closing entry of dividend)

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