ACC 421 Week 2: Prepare closing entries and post to the accounts.
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Intermediate Financial Accounting I Axia College of University of Phoenix (UoP) Problem 3-9 (P3-9) (Adjusting and Closing). Presented below is the December 31 trial balance of Nancy Drew Boutique. AND SO ON Instructions (a) Construct T-accounts and enter the balances shown. (b) Prepare adjusting journal entries for the following and post to the T-accounts. (Omit explanations.) Open additional T-accounts as necessary. (The books are closed yearly on December 31.) (1) Bad debts are estimated to be $1,400. (2) Furniture and equipment is depreciated based on a 6-year life (no salvage value). (3) Insurance expired during the year $2,550. (4) Interest accrued on notes payable $3,360. (5) Sales salaries earned but not paid $2,400. (6) Advertising paid in advance $700. (7) Office supplies on hand $1,500, charged to Office Expense when purchased. (c) Prepare closing entries and post to the accounts.