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Wilson Reed, the bookkeeper for Home Interior Improvements and Designs Company, has just finished posting the closing entries for the…

Wilson Reed, the bookkeeper for Home Interior Improvements and Designs Company, has just finished posting the closing entries for the year to the ledger. He is concerned about the following balances: Capital account balance in the general ledger: $ 48,550 Ending capital balance on the statement of owner’s equity: 27,800 Wilson knows that these amounts should agree and asks for your assistance in reviewing his work. Your review of the general ledger of Home Interior Improvements and Designs Company reveals a beginning capital balance of $25,000. You also review the general journal for the accounting period and find the closing entries shown below. GENERAL JOURNAL DATE DESCRIPTION DEBIT CREDIT 2013 Closing Entries Dec. 31 Fees Income 49,000 Accumulated Depreciation 4,250 Account Payable 16,500 Income Summary 69,750 31 Income Summary 46,200 Salaries Expense 39,000 Supplies Expense 2,500 Depreciation Expense 1,200 James Walker, Drawing 3,500 2. Prepare a general journal entry to correct the errors made.

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