Blue Spruce Furniture Limited reports the following information for 11 months of the year in its February 28, 2021, trial balance. The company's year end is March 31. BLUE SPRUCE FURNITURE LIMITED Trial Balance February 28, 2021 Debit Credit Cash $53,300 Accounts receivable 287,000 Inventory 2,255,000 Supplies 6,150 Prepaid rent 4,100 Equipment 118,900 Accumulated depreciation-equipment $ 23,780 Accounts payable 1,271,000 Deferred revenue 28,700 Bank loan payable 369,000 Common shares 164,000 Common shares 164,000 Retained earnings 451,410 Dividends declared 41,000 Sales 4,352,068 Cost of goods sold 3,151,998 Advertising expense 61,500 Freight out 147,600 Office expense 21,320 Rent expense 45,100 Salaries expense 295,200 Travel expense 10,250 Utilities expense 16,400 Interest expense 22,140 Income tax expense 123,000 $ 6,659,958 $ 6,659,958 Blue Spruce Furniture incurred the following transactions for the month of March. The company uses a perpetual inventory system. Mar. 1 Received $ 102,500 on account from a major customer. 2 Paid a supplier an amount owing of $ 164,000, taking the full discount, terms 2/10, n/30. 5 Purchased merchandise from a supplier, $ 246,000, terms 2/10, n/30, FOB destination. 6 Recorded cash sales, $ 233,700. The cost of goods sold for these sales was $ 164,000. 7 Returned scratched merchandise to the supplier from the March 5 purchase, $ 20,500. 8 The appropriate company paid freight for the March 5 purchase, $ 6,150. 9 Sold $ 164,000 of merchandise on account, terms 2/10, n/30, FOB destination. The cost of goods sold was $ 114,800. Management estimated that sales returns will be 12% of sales. 9 The appropriate company paid freight for the March 9 sale, $ 4,100. 12 Ordered custom merchandise for a local designer totalling $ 41,000. Received $ 10,250 as a deposit. 13 Accepted returned merchandise from the sale on March 9, $ 16,400. The cost of the goods returned to inventory was $ 11,480. 14 Paid for the merchandise purchased on March 5, net of merchandise returns on March 7. 16 Paid salaries of $ 36,900. 16 Paid salaries of $ 36,900. 20 Recorded cash sales, $ 209,100. The cost of goods sold for these sales was $ 146,780. No returns were anticipated related to these sales. 27 Paid salaries of $ 41,000. 29 Received payment of merchandise sold on March 9, net of merchandise returns on March 13. 30 Paid rent, $ 4,100. Date Account Titles and Explanation Debit Credit March 1 Cash 102500 Accounts Receivable 102500 2 Accounts Payable 164000 Cash 164000 5 Accounts Payable 246000 Inventory 246000 6 Cash 233700 Sales 233700 (To record sale) 6 Cost of Goods Sold 164000 (To record sale) 6 Cost of Goods Sold 164000 Inventory 164000 (To record cost of merchandise sold) 7 8 9 Accounts Receivable Sales Refund Liability (To record credit sale) (To record credit sale) 9 Cost of Goods Sold 144320 Estimated Inventory Returns 19680 Inventory 164000 (To record cost of merchandise) 9 Cash (To record payment of freight on goods sold) 12 Deferred Revenue 13 13 (To record return of goods) 13 (To record cost of merchandise returned) 14 16 20 (To record sale) 20 (To record cost of merchandise sold) 27 29 30
