I need to prepare all journal entries to correct the above closing entries

Fees Earned Dr 15000
Accumulated, Amort Dr 5000
Interest Rev Dr 1000
Income Summary Cr 21000

Income summary Dr 19000
Salaries Exp Cr 12000
Prepaid Advertising Cr 5000
Interest Payable Cr 1200
Office Supplies Exp Cr 800

Capital Dr 2000
Income Summary Cr 2000

Withdrawals Dr 6000
Capital Cr 6000

I have figured out all the errors, (accumulated Amort, Perpaid ad and Interest Payable) but now I have to prepare correcting journal entries and I am not sure what they are asking me to do.


Income summery 5,000dr

Accumulated amortization equipme 5,000 cr

To close revenue acc


Prepaid adv 5,000dr

Interest payable 1200dr

Income sumery 6200cr

To close expense acc

Please can you let me know if this is correct

Your entries look correct except that for the Capital and Income Summary account entry you need to reverse it. Also you will need to calculacte the amount in the Income Summary account then you will Debit this account for the balance and Credit the Retained Earnings or Capital account(if no Retained Earnings) for the amount

For the Withdrawals and Capital entry you first need to reverse it, then post the correct entry, which will be a Debit to the Capital account and a Credit to the Withdrawals account. Withdrawals has a normal Debit balance and Capital has a normal Credit Balance so you need to close out your withdrawals to the capital account when closing the books.

Closing entries involve closing out Income Statement accounts to the Balance Sheet accounts. Also you do not close out a Balance Sheet account.

Income summary 2,000 dr
Tom capital 2,000 cr

Income summary 1,200 dr
Tom capital 1,200 cr
To correct income summary and
To close income summary to capital



Capital 6000 dr
Withdrawals 6000cr

To correct wrong entry

Capital 6000 dr
Withdrawals 6000cr

To close the withdrawals acc.