Below is the trial balance for Emiko Company. Prepare the adjusting entries, including the adjusting entry for inventory shrinkage* and then prepare the closing entries. Assume a perpetual system is being used:

*Inventory shrinkage adjusting entry is only recorded when using the perpetual system

Debit Credit

Merchandise Inventory $30,000

Prepaid Selling Expenses 5,600

K. Emiko, Withdrawals 33,000

Sales $529,000

Sales returns and allowances 17,500

Sales Discounts 5,000

Cost of goods sold 212,000

Sales Salaries Expense 48,000

Utilities Expense 15,000

Selling Expenses 36,000

Administrative Expenses 105,000

1: Prepare the Companys adjusting entries:

2: Prepare the Companys closing entries: