Use the work sheet for Finley Company to answer the questions that follow.
The entry to close expenses would be
A) Wages Expense 63,000 Rent Expense 27,000 Depreciation Expense 15,000 Income Summary 105,000
B) Expenses 105,000 Income Summary 105,000
C) Wages Expense 63,000 Rent Expense 27,000 Depreciation Expense 15,000 Dividends 105,000
D) Income Summary 105,000 Wages Expense 63,000 Rent Expense 27,000 Depreciation Expense 15,000

Question

Use the work sheet for Finley Company to answer the questions that follow. 
The entry to close expenses would be
A) Wages Expense 63,000 Rent Expense 27,000 Depreciation Expense 15,000 Income Summary 105,000 
B) Expenses 105,000 Income Summary 105,000 
C) Wages Expense 63,000 Rent Expense 27,000 Depreciation Expense 15,000 Dividends 105,000 
D) Income Summary 105,000 Wages Expense 63,000 Rent Expense 27,000 Depreciation Expense 15,000

Quizplus · Accepted Answer

The entry to close expenses is to debit all expenses accounts (Wages Expense, Rent Expense, and Depreciation Expense) and credit Income Summary for the total amount of expenses (which is $105,000 in this case). Therefore, Choice D is the correct entry to close expenses.

Use the Work Sheet for Finley Company to Answer the Questions