The unadjusted trial balance of Idaho Sales, Inc., on December 31, 1990, the end of the annual accounting period, is shown on the next page.

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1. Copy the unadjusted trial balance on a work sheet form and complete the work sheet using the information that follows.

a. Ending store supplies inventory, \(\$ 395\).

b. Ending office supplies inventory, \(\$ 185\).

c. Expired insurance, \(\$ 3,715\).

d. Depreciation on the store equipment, \(\$ 6,390\).

e. Depreciation on the office equipment, \(\$ 1,715\).

f. Accrued sales salaries payable, \(\$ 515\); and accrued office salaries payable, \(\$ 125\).

g. Additional income taxes expense, \(\$ 785\).

h. Ending merchandise inventory, \(\$ 64,305\).

2. Prepare a multiple-step classified income statement showing in detail the expenses and the items that make up cost of goods sold.

3. Prepare a retained earnings statement.

4. Prepare compound closing entries for the corporation.

5. In addition to the foregoing, prepare a single-step statement of income and retained earnings with the items condensed as is commonly done in published statements.

Transcribed Image Text:

IDAHO SALES, INC. Unadjusted Trial Balance December 31, 1990 Cash Merchandise inventory Store supplies. $ 8,835 66,810 1,460 Office supplies 660 Prepaid insurance 4,340 Store equipment. 65,070 Accumulated depreciation, store equipment $ 9,350 Office equipment 14,505 Accumulated depreciation, office equipment 2,285 Accounts payable. Salaries payable. Income taxes payable 3,375 -0- -0- Common stock, $10 par value. 75,000 Retained earnings 13,955 Dividends declared 7,500 Sales. 534,810 Sales returns and allowances 3,180 Purchases 352,345 Purchases returns and allowances 2,165 Purchases discounts. 4,930 Transportation-in 3,325 Sales salaries expense. 42,145 Rent expense, selling space 19,500 Advertising expense. 5,495 Store supplies expense. -0- Depreciation expense, store equipment -0- Office salaries expense. 39,300 Rent expense, office space. 3,000 Insurance expense. -0- Office supplies expense -0- Depreciation expense, office equipment -0- Income taxes expense. 8,400 Totals $645,870 $645,870