User Account

All Pages

What is the purpose of closing the books

Assignment Help Accounting Basics
Reference no: EM13257587

 

On December 31, 2007, Bert's Farm Store had the followingaccount balances in its accounting system. All year-end adjustmentshad been entered, but the books had not yet been closed.

Bert's FarmStore

Account BalancesBefore Closing

December 31, 2007

Account                         Balance                  Account                              Balance

Cash                             $700                      SalesRevenue                         $2,200

Merchandise                   2,800                      Cost of GoodsSold                    900

Supplies                         925                      WagesExpense                           400

PrepaidInsurance             450                      UtilitiesExpense                           150

Equipment                      3,550                    DepreciationExpense                      50

AccumulatedDepreciation  1,750                    InsuranceExpense                         100

InterestPayable               150                    SuppliesExpense                             150

NotesPayable                  2.000                    Interest Expense                           100

Owner'sEquity                 4,175

a. What is the purpose of closing the books?

b. Prepare all necessary closingentries.

c. After closing, what is the amount of owner's equity that will be reported on the balance sheet?

Reference no: EM13257587

Questions Cloud

Variance amount-variance percentage : What is the variance amount? What is the variance percentage? Is the variance favorable orunfavorable?
What would make for a larger increase in the stock variance : What would make for a larger increase in the stock's variance: an increase of .15 in its beta or an increase of 3% in its residual standard deviation?
Find the distance the sled moves before it stops : A sled of mass m is given a kick on a frozen pond. The kick imparts to it an initial speed of 1.60 m/s. The coefficient of kinetic friction between sled and ice is 0.110. Use energy considerations to find the distance the sled moves before it stop..
Searching library research databases : Identifying scholarly resources, such as peer-reviewed journal articles and searching library research databases (general or subject-specific)
What is the purpose of closing the books : What is the purpose of closing the books? After closing, what is the amount of owner's equity that will be reported on the balance sheet?
Present value of the receivable on biotech books : Compute the present value of the receivable on Biotech's books for January 1, 2006 immediately after receiving the $1million down payment.
Find the characteristic frequencies of the system : Three balls are constrained to move on the circumference of a circle of radius R. find the characteristic frequencies of the system
What was the sticker price of the car : What was the sticker price of the car if the monthly interest rate is 1.5% (periodic rate) and it takes 4 years (48 months) to pay off the car?
Explain how you could use breakeven analysis : Explain how you could use breakeven analysis to determine your bid amount on the proposal. Use the Profit Model to demonstrate your response. Ensure you include a well considered discussion of the revenue and expenses.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Allocation of manufacturing overhead

Manufacturing overhead is allocated to products based on the number of machine hours required. In a year when 20,000 machine hours were anticipated, costs were budgeted at $125,000.

  Net present value of the investment

The net present value of the investment, excluding the intangible benefits, is -$326,237. To the nearest whole dollar how large would the annual intangible benefit have to be to make the investment in the aircraft financially attractive?

  Journal entry-floral arrangements for holidays and events

Adrian's flower show provides floral arrangements for holidays and events. Adrian's sold Oxford City Hall a holiday arrangement for $10,000 on account in November of the amount due within prescribed period.

  Required rate of return for gamma limited

Gamma Ltd is not expecting to pay dividends for three years, at the end of year four, a dividend of $2.00 is planned and dividends are expected to be constant forever after that. The required rate of return for Gamma Ltd equity is 14% pa.

  What are the key components involving translation

Provide at least one college level paragraph. Examples would be helpful and appreciated, Thank you.

  Prepare the journal entry to record the redemption

Lemay decides to redeem these bonds at 101 after paying semiannual interest. Prepare the journal entry to record the redemption on July 1, 2008. (List multiple debit/credit entries in descending order of amount.)

  Variable utility cost per unit

Conan Company's monthly activity level ranged from a low of 17,000 units in May to a high of 26,000 units in October. Average production was 20,000 units per month. Utilities cost was $8,250 in May and $10,500 in October. The variable utility cost..

  Planning and control

The kind of standard that is most useful for planning and control is:

  What is the contribution margin per pound

Wilson's Meats has computed its fixed costs to be $.60 for every pound of meat it can sell given an average daily sales level of 500 pounds. It charges $3.89 per pound of top-grade ground beef. The variable cost per pound is $2.99. What is the con..

  Landscape designs for the customers

Collins Landscape Company purchased various landscaping supplies on account to be used for landscape designs for their customers. How will this business transaction affect the accounting equation?

  Promissory note payable to the order

A $5,000 promissory note payable to the order of Neptune is discounted to Bane by blank endorsement for $4,000. King steals the note from Bane and sells it to Ott, who promises to pay King $4,500. After paying King $3,000, Ott learns that King sto..

  Kraft accountable for such events

a. What issues should the CEO of Nextel consider when deciding whether to adjust Kraft's bonus plan? Do you think the plan should be adjusted? Why? b. Why might it be value increasing for the firm to make Kraft accountable for such events?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd