Question

the second time I post it answer wasnt opmlete

the beginning of Year 2, Oak Consulting had the following normal balances in its accounts:

Account	Balance
Cash	$	31,800
Accounts receivable		20,900
Accounts payable		14,900
Common stock		23,900
Retained earnings		13,900

The following events apply to Oak Consulting for Year 2:

1. Provided $65,500 of services on account.
2. Incurred $3,500 of operating expenses on account.
3. Collected $46,800 of accounts receivable.
4. Paid $39,100 cash for salaries expense.
5. Paid $16,560 cash as a partial payment on accounts payable.
6. Paid a $9,600 cash dividend to the stockholders.

• Record the closure of service revenue.
• Record the closure of expenses account.
• Record the payment of dividends.
• What is the amount of net income for the year?

Answer 1

Journal entries

No.	General Journal	Debit	Credit
1.	Service revenue a/c	$65500
	To Retained earnings a/c		$65500
	[Being record of closure of service revenue]
2.	Retained earnings a/c	$42600
	To Operating expenses a/c		$3500
	To Salaries expense a/c		$39100
	[Being record of closure of expenses account]
3.	Retained earnings a/c	$9600
	To dividends a/c		$9600
	[Being record of payment of dividends]

Calculation of the amount of Net Income for the year

particulars	Amount	Amount($)
Revenue		65500
Less:
Expenses:
Operating expense	3500
Salaries expenses	39100	(42600)
Net Income		22900

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