CLASS 6 and CLASS 7

The co registered the following expenses and revenues in 2020:

- Expenses with electricity (605) 10.000 lei;

- Expenses with rent (612) 25.000 lei;
- Expenses with merchandises (607) 200.000 lei;
- Expenses with salaries (641) 40.000 lei;
- Revenues for rendering services (704) 50.000 lei;
- Revenues from selling merchandises (707) 300.000 lei.

Required:

a) Close the revenues and expenses accounts;

b) Compute and register the income tax.

1. T.N. Closing the revenues accounts

T.A. (-) Revenue accounts (R-) - D (704, 707)

(+) Profit & Loss (OE+) - C (121)

Entry: % = 121 350.000

704 50.000

707 300.000

2. T.N. Closing the expenses accounts

T.A. (-) Expenses (E-) - C (605, 612, 607, 641)
(-) Profit & Loss (OE-) - D (121)
Entry: 121 = % 275.000
605 10.000
612 25.000
607 200.000
641 40.000

Income tax computation:

Income tax = 16* Profit = 16%*(350.000 – 275.000) = 16%*75.000 = 12.000 lei

3. T.N. Registering the income tax

T.A. (+) Income tax payable (L+) - C (441)
(+) Expenses with income tax (E+) - D (691)
 Entry: 691 = 441 12.000

4. T.N. Closing the income tax expense account

T.A. (-) Expenses with income tax (E-) - C (691)
(-) Profit & Loss (OE-) - D (121)

Entry: 121 = 691 12.000