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Brief Exercise 4-6The income statement for Weeping Willow Golf Club for the month ending July 31 shows Service Revenue $16,400, Salaries and Wages Expense $8,200, Maintenance and Repairs Expense $2,500, and Net Income $5,700.SHOW LIST OF ACCOUNTSSHOW ANSWERLINK TO TEXTPost the entries to the revenue and expense accounts, and complete the closing process for these accounts using the three-column form of account.Service RevenueDateExplanationRefDebitCreditBalance7/31Balance7/31Closing entrySalaries and Wages ExpenseDateExplanationRefDebitCreditBalance7/31Balance7/31Closing entryMaintenance and Repairs ExpenseDateExplanationRefDebitCreditBalance7/31Balance7/31Closing entryBrief Exercise 4-9At Creighton Company, the following errors were discovered after the transactions had been journalized and posted.1.A collection on account from a customer for $870 was recorded as a debit to Cash $870 and a credit to Service Revenue $870.2.The purchase of store supplies on account for $1,570 was recorded as a debit to Supplies $1,750 and a credit to Accounts Payable $1,750.Prepare the correcting entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)No.Account Titles and ExplanationDebitCredit1.2.SHOW LIST OF ACCOUNTSSHOW SOLUTIONTIMEOUT ALERTBrief Exercise 4-11Match each of the following accounts to its proper balance sheet classification.AccountsBalance Sheet ClassificationAccounts PayableOwner’s EquityIntangible AssetsLong-term InvestmentsCurrent LiabilitiesCurrent AssetsLong-term LiabilitiesProperty, Plant, and EquipmentAccounts receivableIntangible AssetsCurrent LiabilitiesLong-term InvestmentsProperty, Plant, and EquipmentOwner’s EquityCurrent AssetsLong-term LiabilitiesAccumulated depreciation—buildingsLong-term LiabilitiesOwner’s EquityProperty, Plant, and EquipmentIntangible AssetsCurrent LiabilitiesCurrent AssetsLong-term InvestmentsBuildingsLong-term InvestmentsCurrent LiabilitiesLong-term LiabilitiesOwner’s EquityCurrent AssetsProperty, Plant, and EquipmentIntangible AssetsCashLong-term InvestmentsIntangible AssetsProperty, Plant, and EquipmentOwner’s EquityCurrent AssetsCurrent LiabilitiesLong-term LiabilitiesCopyrightsCurrent LiabilitiesCurrent AssetsLong-term LiabilitiesOwner’s EquityLong-term InvestmentsProperty, Plant, and EquipmentIntangible AssetsIncome taxes payableProperty, Plant, and EquipmentIntangible AssetsOwner’s EquityLong-term InvestmentsCurrent AssetsCurrent LiabilitiesLong-term LiabilitiesDebt investments (long-term)Current AssetsOwner’s EquityIntangible AssetsLong-term LiabilitiesLong-term InvestmentsCurrent LiabilitiesProperty, Plant, and EquipmentLandLong-term InvestmentsLong-term LiabilitiesOwner’s EquityIntangible AssetsProperty, Plant, and EquipmentCurrent AssetsCurrent LiabilitiesInventoryLong-term InvestmentsIntangible AssetsOwner’s EquityCurrent AssetsProperty, Plant, and EquipmentCurrent LiabilitiesLong-term LiabilitiesPatentsLong-term LiabilitiesCurrent LiabilitiesLong-term InvestmentsProperty, Plant, and EquipmentIntangible AssetsOwner’s EquityCurrent AssetsSuppliesIntangible AssetsCurrent LiabilitiesOwner’s EquityLong-term LiabilitiesCurrent AssetsLong-term InvestmentsProperty, Plant, and EquipmentExercise 4-7Kay Magill Company had the following adjusted trial balance.KAY MAGILL COMPANYAdjusted Trial BalanceFor the Month Ended June 30, 2014Adjusted Trial BalanceAccount TitlesDebitCreditCash$Accounts ReceivableSuppliesAccounts Payable$Unearned Service RevenueOwner’s CapitalOwner’s DrawingsService RevenueSalaries and Wages ExpenseMiscellaneous ExpenseSupplies ExpenseSalaries and Wages Payable Total$$Condition gt requires numbers instead of “null” and “0”Prepare closing entries at June 30, 2014. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)No.Account Titles and ExplanationDebitCredit1.(To close revenue account.)2.(To close expense accounts)3.(To close net income / (loss).)4.(To close drawings)Condition gt requires numbers instead of “null” and “0”Prepare a post-closing trial balance.KAY MAGILL COMPANYPost-Closing Trial BalanceFor the Month Ended June 30, 2014DebitCredit$$ Total$$Exercise 4-8Plevin Company ended its fiscal year on July 31, 2014. The company’s adjusted trial balance as of the end of its fiscal year is as shown below.PLEVIN COMPANYAdjusted Trial BalanceJuly 31, 2014No.Account TitlesDebitCredit101Cash$112Accounts Receivable157Equipment158Accumulated Depreciation—Equip.$201Accounts Payable208Unearned Rent Revenue301Owner’s Capital306Owner’s Drawings400Service Revenue429Rent Revenue711Depreciation Expense726Salaries and Wages Expense732Utilities Expense Total$$Condition gt requires numbers instead of “null” and “0”Prepare the closing entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)DateAccount Titles and ExplanationDebitCreditJuly 31(To close revenue accounts.)July 31(To close expense accounts.)July 31(To close net income / ( loss).)July 31(To close drawings.)Condition gt requires numbers instead of “null” and “0”Post to Owner’s Capital and Income Summary accounts. (Post entries in the order of journal entries presented in the previous part.)Owner’s CapitalNo. 301DateExplanationRefDebitCreditBalanceJuly 31Close RevenuesClose ExpensesClose Net Income/LossClose DrawingsBalanceJ15July 31Close ExpensesClose Net Income/LossClose DrawingsClose RevenuesBalanceJ15July 31Close Net Income/LossClose DrawingsBalanceClose ExpensesClose RevenuesJ15Income SummaryNo. 350DateExplanationRefDebitCreditBalanceJuly 31BalanceClose RevenuesClose Net Income/LossClose DrawingsClose ExpensesJ15July 31Close RevenuesClose ExpensesBalanceClose Net Income/LossClose DrawingsJ15July 31Close Net Income/LossClose ExpensesClose DrawingsClose RevenuesBalanceJ15Condition gt requires numbers instead of “null” and “0”Prepare a post-closing trial balance at July 31.PLEVIN COMPANYPost-Closing Trial BalanceJuly 31, 2014DebitCredit$$ Total$$Exercise 4-10Condition gt requires numbers instead of “null” and “0”Janis Engle has prepared the following list of statements about the accounting cycle.Identify each statement as true or false.1.“Journalize the transactions” is the first step in the accounting cycle.TrueFalse2.Reversing entries are a required step in the accounting cycle.TrueFalse3.Correcting entries do not have to be part of the accounting cycle.FalseTrue4.If a worksheet is prepared, some steps of the accounting cycle are incorporated into the worksheet.TrueFalse5.The accounting cycle begins with the analysis of business transactions and ends with the preparation of a post-closing trial balance.TrueFalse6.All steps of the accounting cycle occur daily during the accounting period.FalseTrue7.The step of “post to the ledger accounts” occurs before the step of “journalize the transactions.”FalseTrue8.Closing entries must be prepared before financial statements can be prepared.TrueFalse