4- (40% of Total Marks) DUE DATE: April 14th 2022 @ 11:59pm SUBMISSION FORMAT: MS WORD OR MS EXCEL DOCUMENT You are required to answer all questions: Chef Z Inc. is a qualified chef and educator who does catering for private functions as well as teach at the culinary school. You are the accountant for Chef Z Inc. and must record and complete several transactions to bring the accounting records up to date. You may OMIT explanations for all journal entries required in this paper. Question 1: Financial Statements and Closing Entries Cash Accounts Receivable Supplies Prepaid Insurance Chef Z Inc. Adjusted Trial Balance December 31 Debit Credit $1,180 875 350 1,210 1,200 $ 40 75 56 300 2,000 15 800 Equipment Accumulated Depreciation-Equipment Accounts Payable Salaries and Wages Payable Unearned Service Revenue Notes Payable Interest Payable Share Capital-Ordinary Dividends Service Revenue Salaries and Wages Expense Utilities Expense Advertising Expense Supplies Expense Depreciation Expense Insurance Expense Interest Expense 4,515 1,006 40 110 15 $7,801 $7,801 Instructions Using the information in the adjusted trial balance, do the following. (a) Prepare an income statement and a retained earnings statement for the 2 months ended December 31, and a classified statement of financial position at December 31. (20 marks) (b) Chef Z Inc. has decided that the year-end will be December 31. Prepare closing entries as of December 31. (10 marks) (c) Prepare a post-closing trial balance. (6 marks) (d) Explain why you must prepare closing entries. (4 marks) Question 2 - Merchandising and Inventories Part 1: Chef Z Inc. decides to use the perpetual inventory system. The following transactions happen during the month of January. Prepare journal entries to record all the entries. (15 marks) Jan. 4 Bought five deluxe mixers on account from Ninja Foodi Inc. for $2,875, FOB shipping point, terms n/30. 6 Paid $100 freight on the January 4 purchase. 7 8 Returned one of the mixers to Ninja Foodi Inc because it was damaged during shipping. Ninja Foodi Inc. issues Chef Z Inc. credit for the cost of mixer plus $20 for the cost of freight that was paid on January 6 for one mixer. Collected $375 of the accounts receivable from December 2020. 12 Three deluxe mixers are sold on account for $3,450, FOB destination, terms n/30. (Cost of goods sold is $595 per mixer.) 14 Paid the $75 of delivery charges for the three mixers that were sold on January 12. 14 Bought four deluxe mixers on account from Cusinart Supply Co. for $2,300, FOB shipping point, terms n/30. Part 2: Assume that Chef Z Inc. has decided to use a perpetual inventory system and the following transactions occurred during February to May: Purchase and Sale of Deluxe Mixers Date Description Feb-01 Beginning Inventory Feb-02 Purchase Feb-16 Sale Number Unit Cost/Sales cost per Mixer 1 $ 595 2 $ 600 1 $ 1,150 Mar-02 Purchase 1 $ 618 Mar-30 Sale 2 $ 2,300 Apr-01 Purchase 2 $ 612 Apr-13 Sale 3 $ 1,150 May-04 Purchase 3 $ 625 May-27 Sale 1 $ 1,150