55A Buono Adventures, which uses the perpetual inventory system, has the following account balances (in alphabetical order) on July 31, 2020:

Accounts Payable.......................................................................	$21,600
Accounts Receivable..................................................................	23,200
Accumulated AmortizationEquipment..............................	64,600
Cash..............................................................................................	8,400
Cost of Goods Sold.....................................................................	687,000
E. Buono, Capital........................................................................	402,000
E. Buono, Withdrawals..............................................................	92,000
Equipment..............................	180,000
Interest Earned..........................................................................	4,000
Inventory....................................................................................	143,000
Operating Expenses..................................................................	355,000
Sales Discounts..........................................................................	10,300
Sales Returns and Allowances................................................	32,900
Sales Revenue............................................................................	1,045,200
Supplies......................................................................................	14,600
Unearned Sales Revenue..........................................................	9,000

Note: For simplicity, all operating expenses have been summarized in the account Operating Expenses.

Additional data at July 31, 2020:

1. A physical count of items showed $3,000 of supplies on hand. (Hint: Use the account Operating Expenses in the adjusting journal entry.)

2. An inventory count showed inventory on hand at July 31, 2020, of $140,000.

3. The equipment has an estimated useful life of eight years and is expected to have no scrap or residual value at the end of its life. (Hint: Use the account Operating Expenses in the adjusting journal entry.)

4. Unearned sales revenue of $5,600 was earned by July 31, 2020.

Required

1. Record all adjustments and closing entries that would be required on July 31, 2020.

2. Prepare the multi-step income statement and statement of owners equity for the year ended July 31, 2020, and the classified balance sheet in report format as at July 31, 2020.

3 4

Adjusting and closing the accounts of a merchandising company, and preparing a merchandisers financial statements under the perpetual inventory system

2. Net loss, $67,500