The following unadjusted trial balance is prepared at fiscal year-end for FAB Products Company. Rent expense and

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The following unadjusted trial balance is prepared at fiscal year-end for FAB Products Company.


The following unadjusted trial balance is prepared at fiscal year-end for


Rent expense and salaries expense are equally divided between selling activities and the general and administrative activities. FAB Products Company uses a perpetual inventory system.

Required
1. Prepare adjusting journal entries to reflect each of the following.
a. Store supplies still available at fiscal year-end amount to $3,300.
b. Expired insurance, an administrative expense, for the fiscal year is $3,000.
c. Depreciation expense on store equipment, a selling expense, is $2,800 for the fiscal year.
d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $22,200 of inventory is still available at fiscal year-end.
2. Prepare a multiple-step income statement for fiscal year 2011.
3. Prepare a single-step income statement for fiscal year 2011.
4. Compute the current ratio, acid-test ratio, and gross margin ratio as of October 31,2011.

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Related Book For  book-img-for-question

Fundamental Accounting Principles

ISBN: 978-0078110870

20th Edition

Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta

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