1. LESSON 16-2
Recording Closing Entries
for Income Statement
Accounts
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning

2. 2
THE INCOME SUMMARY ACCOUNT
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 487
LESSON 16-2

3. 3
CLOSING ENTRY FOR ACCOUNTS WITH
CREDIT BALANCES
3
page 488
3
1
2
4
1. Heading
2. Date
3. Debits to close
4. Credit to Income Summary
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 16-2

4. 4
CLOSING ENTRY FOR INCOME STATEMENT
ACCOUNTS WITH DEBIT BALANCES
1.
2.
3.
4.
page 489
Date
Account debited
Credits to close
Debit amount
3
3
1
2
4
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 16-2

5. SUMMARY OF CLOSING ENTRY FOR
INCOME STATEMENT ACCOUNTS WITH
DEBIT BALANCES
Bal.
(New Bal. zero)
Adj. (mdse. inv.)
Closing (debit
accounts)
Purchases
209,960.00 Closing
(New Bal.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 490
209,960.00
Income Summary
15,840.00 Closing (credit
amounts)
404,099.15
5
500,253.10
80,313.95)
LESSON 16-2

6. CLOSING ENTRY TO RECORD
NET INCOME
6
page 491
1
2
3
1. Date
2. Debit Income Summary
3. Credit Retained Earnings
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 16-2

7. 7
CLOSING ENTRY FOR DIVIDENDS
page 491
1
2
3
1. Date
2. Debit Retained Earnings
3. Credit Dividends
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 16-2

8. 8
COMPLETED CLOSING ENTRIES FOR A
CORPORATION RECORDED IN A JOURNAL
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
page 492
LESSON 16-2