Fischer Card Shop is a small retail shop. Fischer's balance sheet at year-end 2018 is as follows. The following information details transactions and adjustments that occurred during 2019.

1. Sales total $ 145,850 in 2019; all sales were cash sales.

2. Inventory purchases total $76,200 in 2019; at December 31, 2019, inventory totals $14,500. Assume all purchases were made on account.

3. Accounts payable totals $4,100 at December 31, 2019.

4. Annual store rent of $24,000 was paid on March 1, 2019, covering the next 12 months. The balance in prepaid rent at December 31, 2018, was the balance remaining from the advance rent payment in 2018.

5. Wages are paid every other week on Friday; during 2019, Fischer paid $12,500 cash for wages. At December 31, 2019, Fischer owed employees unpaid and unrecorded wages of $350.

6. Depreciation on equipment totals $1,700 in 2019.

REQUIRED:

a. Prepare any necessary transaction entries for 2019 and adjusting entries at December 31, 2019, using the financial statement effects template.

b. Prepare any necessary transaction entries for 2019 and adjusting entries at December 31, 2019, in journal entry form.

c. Set up T-accounts, enter the balances above, and post the transactions and adjusting entries to them.

d. Prepare its income statement for 2019, and its balance sheet at December 31, 2019.

e. Prepare entries to close its temporary accounts in journal entry form and post the closing entries to the T-accounts.

Transcribed Image Text:

FISCHER CARD SHOP Balance Sheet December 31, 2018 Cash.... $ 8,500 Accounts payable... $ 5,200 Inventories.. 12,000 Wages payable.... 100 Prepaid rent 3,800 Total current liabilities.... 5,300 Total current assets .. 24,300 Total equity (includes retained earnings)... 23,500 Equipment... $7,500 Total liabilities and equity. $28,800 . .... Less accumulated depreciation... 3,000 Equipment, net. 4,500 Total assets $28,800