Taylor Art Supplies Company sells various art supplies to local artists. The business uses a perpetual inventory system, and the cost of its inventory of art supplies at the beginning of August was \(\$ 2500\). Its cash balance was \(\$ 800\) at the beginning of August, and it entered into the following transactions during August:

Required:
a Prepare journal entries to record the preceding transactions.
b Set up appropriate T-accounts, post the journal entries to the accounts (for simplicity, it is not necessary to assign numbers to the accounts) and determine the ending account balances.

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Date 1 Aug. 4 6 10 12 13 15 25 Transaction Purchased $440 of art supplies for cash. Made a $990 sale of art supplies on credit to P. Marks, with terms of n/15. The cost of the inventory sold was $550. Purchased $770 of art supplies on credit from Tott Company, with terms of n/20. Returned, for credit to its account, $110 of defective art supplies purchased on 6 August from Tott Company. Made cash sales of $275 to customers. The cost of the inventory sold was $160. Refunded a $22 allowance to a customer for damaged inventory sold on 12 August. Received payment from P. Marks of the amount due for inventory sold on credit on 4 August. Paid balance due to Tott Company for purchase on 6 August.