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Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. The owner's capital account before closing had a balance of $307,000. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is________
Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. The owner's capital account before closing had a balance of $307,000. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is________
Final answer:The entry to close theIncome Summaryaccount at the end of the year is $64,300, giving a new capital account balance of $371,300.Explanation:In this question, we are looking at the end-of-yearaccountingfor Tara Westmont, theproprietorof Tiptoe Shoes. Her revenues for the year were $195,000, and her expenses were $108,700 which gives a net income of ($195,000 - $108,700) = $86,300. The income summary account will be closed to thecapitalaccount. At the start of the year, Tara Westmont's capital was $307,000. Therefore, the capital account increase will be the net income minus the owner's withdrawal ($86,300 - $22,000) = $64,300. The end-of-year balance in the capital account will be the beginning balance plus the increase in capital ($307,000 + $64,300) = $371,300.Learn more aboutAccountinghere:brainly.com/question/33068790#SPJ11...