Canyon Canoe Company is a service based company that rents canoes for use on local lakes and rivers. At the beginning of the new year, Canyon Canoe Company decided to carry and sell T-shirts with its logo printed on them. Canyon Canoe Company uses the perpetual inventory system to account for the inventory. During January 2025, Canyon Canoe Company completed these and posted the merchandising transactions to the ledger accounts. Canyon Canoe Company does not typically prepare adjusting and closing entries each month, but the company is surprised at how popular the shirts are and wishes to know the net income for January and would also like to understand how to prepare the closing entries for a merchandising company. During January 2025, Canyon Canoe Company completed the following non-merchandising transactions: (Click the icon to view the non-merchandising transactions.) Read the requirements. Jan. 1 Purchased 10 T-shirts at $4 each and paid cash. Jan. 2 Sold 6 T-shirts for $10 each, total cost of $24. Received cash. Jan. 3 Purchased 50 T-shirts on account at $5 each. Terms 2/10,n/30. Jan. 7 Paid the supplier for the T-shirts purchased on January 3, less discount. Jan. 8 Realized 4 T-shirts from the January 1 order were printed wrong and returned them for a cash refund. Jan. 10 Sold 40 T-shirts on account for $10 each, total cost of $200. Terms 3/15,n/45. Jan. 12 Received payment for the T-shirts sold on account on January 10, less discount. Jan. 14 Purchased 100 T-shirts on account at $4 each. Terms 4/15, n/30. Jan. 18 Canyon Company called the supplier from the January 14 purchase and told them that some of the T-shirts were the wrong color. The supplier offered a $50 purchase allowance. Jan. 20 Paid the supplier for the T-shirts purchased on January 14, less the allowance and discount. Jan. 21 Sold 60 T-shirts on account for $10 each, total cost of $220. Terms 2/20,n/30. Jan. 23 Received a payment on account for the T-shirts sold on January 21, less discount. Jan. 25 Purchased 320 T-shirts on account at $5 each. Terms 2/10, n/30, FOB shipping point. Jan. 27 Paid freight associated with the January 25 purchase, $48. Jan. 29 Paid for the January 25 purchase, less discount. Jan. 30 Sold 275 T-shirts on account for $10 each, total cost of $1,300. Terms 2/10,n/30. Jan. 31 Received payment for the T-shirts sold on January 30 , less discount. Jan. 2 Collected \$4,500 on account. Jan. 15 Paid the utilities and telephone bills from December. (On December 20, the company received bills for the telephone (\$325) and utilities (\$295). At that time the company recorded a Telephone Payable liability and a Utilities Payable liability, respectively.) Jan. 15 Paid the wages accrued in December. (Wages accrued in December amounted to $1,250 and was recorded as a Wages Payable liability.) Jan. 18 Rented canoes and received cash, $1,825. Jan. 20 Received bills for utilities (\$360) and telephone (\$275) which will be paid later. Jan. 23 Paid various accounts payable, $1,800. Jan. 30 Paid employee, $750. 1. Journalize and post the January transactions. Omit explanations. Use the ledger provided for posting. 2. Journalize and post the adjusting entries for the month of January. Omit explanations. Denote each adjustment as Adj. Compute each account balance, and denote the balance as Bal. In addition, Canyon Canoe Company provides this data: a. A physical count of the inventory at the end of the month revealed the cost was $470. b. The company estimated sales returns will be $30 with a cost of $15. c. Office supplies used, $55. d. The Unearned Revenue has now been earned. e. Interest expense accrued on the notes payable, $50. f. Rent of one month has been used. (On December 1 , the company prepaid $3,000 for three months' rent on the warehouse where the company stores the canoes. On December 31, the company recorded one month's worth of rent expense for the month of December in the amount of $1,000.) g. Monthy depreciation on the building amounts to $500. h. Monthy depreciation on the canoes amounts to $250. 3. Prepare the month ended January 31, 2025, single step income statement of Canyon Canoe Company. 4. Journalize and post the closing entries. Omit explanations. Denote each closing amount as Clo. and each balance as Bal. After posting all closing entries, prove the equality of debits and credits in the ledger by preparing a post-closing trial balance. 5. Compute the gross profit percentage for January for Canyon Canoe Company