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| The alphabetical listing below includes all of the adjusted account balances of T.O.’s Dance Studio as of December 31, 2015. All account balances are normal. |
| Accounts Payable | $ 4,600 | |
| Accounts Receivable | 8,900 | |
| Accumulated Depreciation––Equipment | 3,500 | |
| Common Stock | 2,800 | |
| Cash | 3,500 | |
| Depreciation Expense | 1,300 | |
| Dividends | 1,200 | |
| Equipment | 10,300 | |
| Income Tax Expense | 1,900 | |
| Income Taxes Payable | 1,900 | |
| Rent Expense | 1,900 | |
| Retained Earnings | 4,400 | |
| Salaries and Wages Expense | 8,600 | |
| Service Revenue | 18,300 | |
| Unearned Revenue | 2,100 | |
| Required: | |
| a. | Prepare the closing entries. (If no entry is required for a transaction/event, select “No Journal Entry Required” in the first account field.) |
| b. | Prepare the post-closing trial balance as of December 31, 2015. (Enter all account balances, including any that may carry a zero-balance.) |
| c. | Prepare the classified balance sheet at December 31, 2015. (Amounts to be deducted should be indicated by a minus sign.) |
Expert Answer
First we will prepare Income statement to calculate profit / loss and then transfer its figure to retained earnings in order to get the closing balance of retained earnings.
