Presented below is selected information related to Hoerl Co. for the month of January 2022.

a. Prepare the necessary adjusting entry for inventory.
b. Prepare the necessary closing entries.

Transcribed Image Text:

Ending inventory per perpetual records Ending inventory actually on hand Cost of goods sold Freight-out $ 21,600 21,000 218,000 7,000 Insurance expense Rent expense Salaries and wages expense Sales discounts Sales returns and allowances Sales revenue $ 12,000 20,000 55,000 10,000 13,000 380,000