Assignment Overview You are an accountant for Water Works. Your knowledge of merchandising operations is critical as you prepare several reports, including: Purchase and sales transactions. Multi-step income statement. Closing entries. This assignment is intended to provide additional practice applying Generally Accepted Accounting Principles (GAAP) to accounting problems. Assignment Details: Perform the following tasks: Complete the reading assignment and the interactive lesson before attempting this assignment. Attend the instructor session to prepare for this assignment. Review the transactions that occurred in September for Water Works, on page 2-3. Using the Week 5 Assignment Worksheet and the tables below, complete the following reports: o Journalize the transactions. No explanations are needed. Identify each accounts payable and accounts receivable with vendor or customer name. o Prepare the multi-step income statement for Water Works, as of September 30. o Journalize the closing entries for Water Works. Submit the Week 5 Assignment via Blackboard by clicking on the Week 5 Assignment link. Include the proper file naming convention: ACC105_wk5_assn_jsmith_mmddyyyy. Transactions for Water Works - September Date Transaction Description September 3 Purchased merchandise inventory on account from Simmon Wholesalers, $3,500. Terms 2/15, n/EOM, FOB shipping point. September 4 Paid freight bill of $60 on September 3 purchase. September 4 Purchased merchandise inventory for cash of $2,400. September 6 Returned $900 of inventory from September 3 purchase. September 8 Sold merchandise inventory to Hilton Company, $5,700, on account. Terms 1/15, n/35. Cost of goods, 42,280. September 9 Purchase merchandise inventory on account from Teaton Wholesalers, $10,500. Terms 3/10, n/30, FOB destination. September 10 Made payment to Simmon Wholesalers for goods purchased on September 3, less return and discount. September 12 Received payment from Hilton Company, less discount. September 13 After negotiations, received a $500 allowance from Teaton Wholesalers. September 15 Sold merchandise inventory to Jesper Company, $3,200, on account. Terms 2/10, n/EOM. Cost of goods, $1,408. September 22 Made payment, less allowance, to Teaton Wholesalers for goods purchased on September 9. September 23 Jesper Company returned $600 of the merchandise sold on September 15. Cost of goods, $264. September 25 Sold merchandise inventory to Sundun for $1,800 on account that cost $792. Terms 2/10, n/30 were offered, FOB shipping point. As a courtesy to Sundan, $40 of freight was added to the invoice for which cash was paid by Orange Glove. September 26 After negotiations, granted a $250 allowance to Sundan for merchandise purchased on September 25. September 29 Received payment from Sundan, less allowance and discount. September 30 Received payment from Jesper Company, less return. The Adjusted Trial Balance for Water Works at September 30 Water Works Adjusted Trial Balance September 30 Account Title Balance Debit Credit Cash $ 3,900 Accounts Receivable 38,300 Merchandise Inventory 18,100 Office Supplies 550 Furniture 39,200 Accumulated Depreciation Furniture $ 8,100 Accounts Payable 13,700 Salaries Payable 850 Unearned Revenue 7,000 Notes Payable, long-term 16,000 Water Works, Capital 23,600 Water Works, Withdrawals 39,500 Sales Revenue 190,000 Sales Returns and Allowances 4,000 Sales Discounts 3,000 Cost of Goods Sold 76,000 Selling Expense 19,400 Administrative Expense 15,500 Interest Expense 1,800 Total $ 259,250 $ 259,250

Transactions for Water Works - September

Date	Transaction Description
September 3	Purchased merchandise inventory on account from Simmon Wholesalers, $3,500. Terms 2/15, n/EOM, FOB shipping point.
September 4	Paid freight bill of $60 on September 3 purchase.
September 4	Purchased merchandise inventory for cash of $2,400.
September 6	Returned $900 of inventory from September 3 purchase.
September 8	Sold merchandise inventory to Hilton Company, $5,700, on account. Terms 1/15, n/35. Cost of goods, 42,280.
September 9	Purchase merchandise inventory on account from Teaton Wholesalers, $10,500. Terms 3/10, n/30, FOB destination.
September 10	Made payment to Simmon Wholesalers for goods purchased on September 3, less return and discount.
September 12	Received payment from Hilton Company, less discount.
September 13	After negotiations, received a $500 allowance from Teaton Wholesalers.
September 15	Sold merchandise inventory to Jesper Company, $3,200, on account. Terms 2/10, n/EOM. Cost of goods, $1,408.
September 22	Made payment, less allowance, to Teaton Wholesalers for goods purchased on September 9.
September 23	Jesper Company returned $600 of the merchandise sold on September 15. Cost of goods, $264.
September 25	Sold merchandise inventory to Sundun for $1,800 on account that cost $792. Terms 2/10, n/30 were offered, FOB shipping point. As a courtesy to Sundan, $40 of freight was added to the invoice for which cash was paid by Orange Glove.
September 26	After negotiations, granted a $250 allowance to Sundan for merchandise purchased on September 25.
September 29	Received payment from Sundan, less allowance and discount.
September 30	Received payment from Jesper Company, less return.

The Adjusted Trial Balance for Water Works at September 30

Water Works
Adjusted Trial Balance
September 30
Account Title	Balance
	Debit	Credit
Cash	$ 3,900
Accounts Receivable	38,300
Merchandise Inventory	18,100
Office Supplies	550
Furniture	39,200
Accumulated Depreciation Furniture		$ 8,100
Accounts Payable		13,700
Salaries Payable		850
Unearned Revenue		7,000
Notes Payable, long-term		16,000
Water Works, Capital		23,600
Water Works, Withdrawals	39,500
Sales Revenue		190,000
Sales Returns and Allowances	4,000
Sales Discounts	3,000
Cost of Goods Sold	76,000
Selling Expense	19,400
Administrative Expense	15,500
Interest Expense	1,800
Total	$ 259,250	$ 259,250