The Board Shop, owned by Andrew John, sells skateboards in the summer and snowboards in the winter. The shop has an August 31 fiscal year end and uses a perpetual inventory system. On August 1, 2014, the company had the following balances in its general ledger:

                           

During August, the last month of the fiscal year, the company had the following transactions:

Aug. 1 Paid $1,650 for August’s rent.
2 Paid $6,500 on account.
4 Sold merchandise costing $7,900 for $12,260 cash.
5 Purchased merchandise on account from Orange Line Co., FOB shipping point, for $24,500.
5 Paid freight charges of $500 on merchandise purchased from Orange Line Co.
8 Purchased supplies on account for $345.
9 Refunded a customer $425 cash for returned merchandise. The merchandise had cost $265 and was returned to inventory.
10 Sold merchandise on account to Spider Company for $15,750, terms 2/10, n/30, FOB shipping point. The merchandise had a cost of $9,765.
11 Paid Orange Line Co. for half of the merchandise purchased on August 5.
12 Spider Company returned $750 of the merchandise it purchased. Board Shop issued Spider a credit memo. The merchandise had a cost of $465 and was returned to inventory.
15 Paid salaries, $3,100.
19 Spider Company paid the amount owing.
21 Purchased $9,900 of merchandise from Rainbow Option Co. on account, terms 2/10, n/30, FOB destination.
23 Returned $800 of the merchandise to Rainbow Option Co. and received a credit memo.
24 Received $525 cash in advance from customers for merchandise to be delivered in September.
30 Paid salaries, $3,100.
30 Paid Rainbow Option Co. the amount owing.
31 Andrew John withdrew $4,800 cash.

Adjustment and additional data:
1. A count of supplies on August 31 shows $755 on hand.
2. The equipment has an estimated eight-year useful life.
3. Of the notes payable, $6,000 must be paid on September 1 each year.
4. An analysis of the Unearned Revenue account shows that $3,750 has been earned by August 31. A corresponding $2,325 for Cost of Goods Sold will also need to be recorded for these sales.
5. Interest accrued on the note payable to August 31 was $175.
6. A count of the merchandise inventory on August 31 shows $76,560 of inventory on hand.

Instructions
(a) Create a general ledger account for each of the above accounts and enter the August 1 balances.
(b) Record and post the August transactions.
(c) Prepare a trial balance at August 31, 2014.
(d) Record and post the adjustments required at August 31, 2014.
(e) Prepare an adjusted trial balance at August 31, 2014.
(f) Prepare a multiple-step income statement, statement of owner’s equity, and classified balance sheet.
(g) Record and post closing entries.
(h) Prepare a post-closing trial balance at August 31, 2014.