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The ledger of Paul Consulting contains the following balances: Paul, Capital $30,000; Paul, Drawing $2,000; Service...

The ledger of Paul Consulting contains the following balances: Paul, Capital $30,000; Paul, Drawing $2,000; Service revenue $50,000; Salaries expense $23,000; and Supplies expense $4,000. The closing off entry for Profit or Loss summary on 30 June is:

Select one:

a. debit Paul, Capital 50000, Profit or Loss summary 50000.

b. debit Profit or Loss summary 23000, credit Paul, Capital 23000.

c. debit Paul, Capital 23000, credit Profit or Loss summary 23000.

d. debit Profit or Loss summary 30000, credit Paul, Capital 30000.

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Answer #1

Journal Entry:

Date Particulars Debit ($) Credit ($)
30-Jun-20 Profit or Loss Summary Dr $23,000
                     To Paul Capital A/C $23,000

a)

S.No Particulars Amount ($)
A Service Revenue $50,000
B Salaries Expense $23,000
C Suplies Expense $4,000
D Net Income (A-B-C) $23,000

b) Drawings made does not effect Profit and Loss Summary

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