Question

[The following information applies to the questions displayed below.) Starbooks Corporation provides an online bookstore for electronic books. The following is a simplified list of accounts and amounts reported in its accounting records. The accounts have normal debit or credit balances. Assume the year ended on September 30, 2018. $ 591 291 891 291 191 191 291 3,191 291 91 Accounts Payable Accounts Receivable Accumulated Depreciation Cash Common Stock Deferred Revenue Depreciation Expense Equipment Income Tax pense Interest Revenue Notes Payable (long-term) Notes Payable (short-term) Prepaid Rent Rent Expense Retained Earnings Salaries and Wages Expense Service Revenue Supplies Supplies Expense Travel Expense 191 491 91 391 1,491 2,191 6,173 491 191 2,591 2. Prepare the closing entry required at September 30, 2018. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 1

Answer 1

Income statement

Interest Revenue	91
Service revenue	6,173
Total revenue		6,264
Expenses :
Rent expense	391
Depreciation expense	291
Salaries and wages expense	2,191
Income tax expense	291
Supplies expense	191
Travel expense	2,591
Total expense		-5,946
Net income		$318

All temporary accounts i.e. accounts of revenue and expenses are closed at the end of the accounting period.

Hence, the following closing entry will be made :

Journal

Date	Account Title and Explanation	Debit	Credit
Sept 30,2018	Interest revenue	91
	Service revenue	6,173
	Depreciation expense		291
	Income tax expense		291
	Rent expense		391
	Salaries and wages expense		2,191
	Supplies expense		191
	Travel expense		2,591
	Retained earnings		318