Question

Best Buy, Co., Inc’s financial statements say: “We are driven by our purpose to enrich lives through technology. We do that by leveraging our combination of tech and a human touch to meet our customers’ everyday needs, whether they come to us online, visit our stores or invite us into their homes. We have operations in the U.S., Canada and Mexico. We operate under various brand names including Best Buy, Best Buy Business, Best Buy Express, Best Buy Health, Best Buy Mobile, CST, Geek Squad, GreatCall, Lively, Magnolia and Pacific Kitchen and Home, bestbuy.com, greatcall.com, bestbuy.ca, and bestbuy.com.mx.”

Below are the account balances (all normal) for Best Buy, Co., Inc., as of February 1, 2020 after adjusting journal entries but before closing entries. The accounts are listed in alphabetical order. All amounts are in millions of U.S. dollars. The company's fiscal year ends on Saturday nearest the end of January each calendar year. Fiscal year 2020 ended on February 1, 2020, and fiscal year 2019 ended on February 2, 2019. There was no new investment by stockholders during fiscal 2020 (Hint: read this as no change in Common Stock).

Accounts payable	5,288
Accounts receivable	1,149
Accumulated depreciation	6,900
Cash	2,229
Common stock	26
Cost of sales	33,590
Current portion of long-term debt	674
Depreciation expense	740
Dividends	536
General and administrative expenses	7,299
Goodwill and other long-term assets	4,406
Income tax expense	452
Interest expense	64
Interest revenue	48
Long-term debt	1,257
Merchandise inventories	5,174
Other current assets	305
Other long-term liabilities	2,795
Property and equipment	9,228
Retained earnings	2,448
Sales revenue	43,638
Unearned revenue	782
Wages payable	1,316

Required:

Prepare the following for fiscal 2020 for Best Buy:

1. Closing journal entries

Part (a):  Prepare Best Buy’s fiscal 2020 closing journal entries. Your journal entries should be in proper journal entry form (i.e., entries, rather than T accounts). There are more rows than you need. Also answer three short questions below by providing the amount and its meaning where appropriate (9.5 points).

Account Titles	Debit	Credit

Answer 1

CLOSING JOURNAL ENTRIES

DR	SALES	43638
CR	INCOME SUMMARY		43638
	(CLOSING SALES A/C)
DR	INTERST REVENUE	48
CR	INCOME SUMMARY		48
	(CLOSING REV. ACCOUNT)
DR	INCOME SUMMARY	42145
CR	COST OF SALES		33590
CR	DEPRECIATION EXP		740
CR	GENERAL AND ADMIN EXP		7299
CR	INCOMETAX EXP		452
CR	INTEREST EXP		64
	(CLOSING ALL EXP. A/C)
DR	INCOME SUMMARY	1541
CR	RETAINED EARNINGS(43638+48-42145)		1541
	(TRANSFERRING TO PERMANENT ACCOUNT
DR	RETAINED EARNINGS	536
CR	DIVIDENDS		536
	(PAYMENT OF DIVIDEND)