Let's determine the total amount of expenses to be closed out and transferred to the Income Summary account by following these steps:
1. List the initial expenses from the trial balance:
- Salaries Expense: \[tex]$15,125
- Office Supplies Expense: \$[/tex]1,200
- Rent Expense: \[tex]$2,900
- Telephone Expense: \$[/tex]600
- Insurance Expense: \[tex]$720
- Sheila James, Drawing: \$[/tex]4,170
- Taxes Expense: \[tex]$1,420
- Miscellaneous Expense: \$[/tex]905
2. Record the adjustments based on the given additional information:
- Expired insurance premiums for the month: \[tex]$75
- Office supplies used during October: \$[/tex]120
- Salaries due but unpaid: \[tex]$750
3. Calculate the adjusted expenses:
To find the adjusted total expense, we need to sum up all the initial expenses along with the adjustments:
\[
\text{Total Expense} = 15,125 + 1,200 + 2,900 + 600 + 720 + 4,170 + 1,420 + 905 + 75 + 120 + 750
\]
4. Add these amounts together:
\[
15,125 + 1,200 + 2,900 + 600 + 720 + 4,170 + 1,420 + 905 + 75 + 120 + 750 = 27,985
\]
Thus, the total amount of expense from all sources to be closed out and transferred to the Income Summary account is \(\$[/tex]27,985\).
None of the answer choices (\[tex]$24,065, \$[/tex]23,965, \[tex]$23,890, \$[/tex]22,870) matches the correct total of \$27,985. This suggests either a mistake in the options provided or an error in the problem setup.
