The accountant of the marketing firm, S. Preston, has posted adjusting entries (1) to (5) to the ledger accounts at 30 June 2019. All the income, expense and equity accounts of the entity are listed here in T‐account form.

Required

(a) Prepare the closing entries of the marketing firm at 30 June 2019.

(b) Prepare the income statement and the statement of changes in equity for the year ended 30 June 2019.

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Accounts Receivable 31 500 (5) 20 000 S. Preston, Capital 67 500 Salaries Expense 78 000 (4) 4 400 Accum. Depr. - Buildings 96 000 (3) 24 000 Supplies 33 500 (1) 26 000 S. Preston, Drawings 36000 Supplies Expense (1) 26000 Accum. Depr. - Furniture 6500 (2) 5 600 Salaries Payable (4) 4400 Service Revenue 166 500 (5) 20 000 Depr. Expense - Buildings (3) 24000 Depr. Expense - Furniture (2) 5600