Question

Presented below are selected account balances for Blossom Co. as of December 31, 2020.

Inventory 12/31/20		$59,590		Cost of Goods Sold		$229,667
Common Stock		74,470		Selling Expenses		16,223
Retained Earnings		44,230		Administrative Expenses		37,519
Dividends		18,226		Income Tax Expense		30,500
Sales Returns and Allowances		11,922
Sales Discounts		14,790
Sales Revenue		408,340

Prepare closing entries for Blossom Co. on December 31, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

Answer 1

S.No	Account titles & explanation	Debit	Credit
1	Sales Revenue	$408,340
	Income Summary		$408,340
	(To close accounts with credit balances)

S.No	Account titles & explanation	Debit	Credit
2	Income summary	$340,621
	Sales returns & Allowances		$11,922
	Sales Discounts		$14,790
	Selling expense		$16,223
	Cost of goods sold		$229,667
	Administrative expense		$37,519
	Income tax expense		$30,500
	(To close accounts with debit balances)

S.No	Account titles & explanation	Debit	Credit
3	Income summary	$67,719
	Retained Earnings		$67,719
	(To close Net income) [$408,340 - $340,621]

S.No	Account titles & explanation	Debit	Credit
4	Retained Earnings	$18,226
	Dividends		$18,226
	(To close Dividends)