Comprehensive Problem 2 Part 3: NOTE: You must complete parts 1 and 2 before completing part 3. Prepare an unadjusted trial balance. If an amount box does not require an entry, leave it blank. Palisade Creek Co. Unadjusted Trial Balance May 31, 2016 Debit Balances Credit Balances Cash Accounts Receivable Inventory 583,950 Estimated Retums Inventory 15,200 Prepaid Insurance 16,800 Accou Store Supplies 13,800 Store Equipment 569,500 Accumulated Depreciation-Store Equipment 56,700 Accounts Payable 63,150 Salaries Payable Accounts Payable 63,150 Salaries Payable Customers Refunds Payable 29,270 Common Stock 100,000 Retained Earnings 585,300 Dividends 135,000 Sales Cost of Goods Sold 3,013,000 Sales Salaries Expense w 720,800 Advertising Expense 292,000 Depreciation Expense Store Supplies Expense Miscellaneous Selling Expense 12,600 Office Salaries Expense 411,100 Rent Expense 88,700 Insurance Expense Miscellaneous Administrative Expense 7,800 Comprehensive Problem 2 Part 1 and Part 2 Palisade Creek Co. is a real business that uses the perpetual inventory system. The account balances to Vitae Creek as of May 1, 2010 (unless otherwise indicated), are as follows. Assume all accounts have normal balance 110 Cash $83,600 312 Dividends $135,000 112 Accounts Receivable 233,900 410 Sales 5,069.000 115 Inventory 624,400 510 Cost of Goods Sold 2,823,000 116 Estimated Returns Inventory 28,000 520 Sales Salaries Expense 664,800 117 Prepaid Insurance 16,800 521 Advertising Expense 281,000 118 Store Supplies 11,400 522 Depreciation Expense 123 Store Equipment 569,500 523 Store Supplies Expense 124 Accumulated Depreciation-Store Equipment 56,700 529 Miscellaneous Selling Expense 12,600 210 Accounts Payable 95,600 530 Office Salanes Expense 382,100 211 Salaries Payable 531 Rent Expense 33,700 212 Customers Refunds Payable 50,000 532 Insurance Expense 310 Common Stock 100,000 539 Miscellaneous Administrative Expense 7,800 311 Retained Earnings 585,300 Part 1: Journalize the transactions below for May, the last month of the fiscal year. If an amount box does not require an entry leave it blank May 1: Paid rent for May, $5,000 May 1: Paid rent for May, $5,000. Date Description May 1 Rent Expense Post. Ref. Debit Credit 5,000 Cash 5,000 May 2: Sold merchandise on account to Korman Co., terms /15, FOB shipping point, 568,500. The cost of the goods told was $41,000. Date Description Post. Ref. Debit Credit May 2 Accounts Receivable-Korman Co. 68,500 Sales 68,500 May 2 Cost of Goods Sold 41,000 Inventory 41,000 May 3: Purchased merchandise on account from Martin Co., terms 2/10, 1/30, FOB shipping point, 536,000. Date Description Post. Ref. Debit Credit May 3 Inventory 36,000 Accounts Payable-Martin Co. 36,000 May 4: Pand freight on purchase of May 3, $600. Darlin Dorption Poste May 4 Inventory Debat Credit 600 600 May 7: Received $22,300 cash from Halstad Co, on account Date Description Post. Rel Debit Credit May 7 th 22,300 Accounts Receivable-Halstad.co 22,300 May 10: Sold merchandise with a list price of $61,500 to customers who used VISA and who redeemed $7,500 of point-of-sale coupons. The cost of the goods sold was $32,000 Date Description Post. Rel. Debit May 10-Sales Cash 54,000 Sales 54,000 May 10-Cost Cost of Goods Sold 32,000 Inventory 32,000 May 13: Paid for merchandise purchased on May 3. Date Description Post. Ref. May 13 Accounts Payable-Martin Co. Debit Credit 36,000 Cash 35,280 Inventory 720 May 15: Paid advertising expense for last half of May, $11,000. Date Description Post. Ref. Debit Credit May 15 Advertising Expense 11,000 Cash 11,000 Post. Ref. Debit Credit May 17: Received cash from sale of May 2. Date Description May 17 Cash 68,500 68,500 Accounts Receivable-Korman Co. May 19: Purchased merchandise for cash, $18,700, Date Post Rel Debit Credit Description Inventory May 19 18,700 Cash 18,700 May 19: Paid $33,450 to Buttons Co. on account. Date Description May 19 Accounts Payable-Buttons Co. Post. Ref. Debit Credit 33,450 Cash 33,450 Date Post. Ref. Debit May 20: Paid Korman Co. a cash refund of $13,230 for returned merchandise from sale of May 2. The cost of the returned merchandise was $8,000. Description Credit May 20-Refund Customers Refunds Payable 13,230 13,230 Cash May 20-Cost Inventory 8,000 Estimated Returns Inventory 8,000 May 21: Sold merchandise on account to Crescent Co., terms w/com, FOB shipping point, $110,000. The cost of the goods sold was $70,000 Data Description Post. Rel Debit May 21 Sales Accounts Receivable Crescent Co. 108,900 Sales 108,900 May 21-Cost Cost of Goods Sold 70,000 Inventory 70,000 Date Dehit May 21: For the convenience of Crescent Co., paid freight on sale of May 21, $2,300. Description Post. Rel Credit May 21 Accounts Receivable Crescent Co. 2,300 Cash 2,300 May 21+ Received $42,900 cash from Gee Co. on account. Date Description Post Rel Debit Credit May 21 Cash 42,900 Accounts Receivable Gee co. 42,900 May 21: Purchased merchandise on account from Osterman Co., terms 1/10, 1/30, FOB destination, $88,000. Date Description Postitel Debit Credit May 21 Inventory 88,000 Accounts Payable-Osterman Co. 88,000 May 24: Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000. Date Description Post. Rel. Debit Credit May 24 Accounts Payable-Osterman Co. 5,000 Inventory 5,000 May 26: Refunded cash on sales made for cash, $7,500. The cost of the merchandise returned was $4,800, Date Description Post. Ref. Debit Credit May 26-Refund Customers Refunds Payable 7,500 Cash 7,500 May 26-Cost Inventory 4,800 Estimated Returns Inventory 4,800 May 28: Paid sales salaries of $56,000 and office salaries of $29,000. Dale Description Poster Debit May 28 Sales Salones Expense 56,000 Credit Office Salanes Expense 29,000 Cash 85,000 May 29: Purchased store supplies for cash, $2,400. Date Description Post. Rel Debit Credit May 29 Store Supplies 2,400 Cash 2,400 May 30: Sold merchandise on account to Turner Co., terms 1/30, FOB shipping point, $78,750. The cost of the goods sold was $47,000. Date Description Post, Rel. Debit Credit May 30-Sales Accounts Receivable-Turner Co. 78,750 Sales 78,750 May 30-Cost Cost of Goods Sold 47,000 Inventory 47,000 May 31: Received cash from sale of May 21 plus freight. Date Description Post. Ref. Debit Credit May 31 Cash 111,200 Accounts Receivable-Crescent Co. 113,300 May 31: Paid for purchase of May 21, less return of May 24. Date Description Post. Ref. Debit Credit May 31 Accounts Payable-Osterman Co. 83,000 Cash 82,170 Inventory 830 Comprehensive Problem 2 Part 3: NOTE: You must complete parts 1 and 2 before completing part 3. Prepare an unadjusted trial balance. If an amount box does not require an entry, leave it blank. Palisade Creek Co. Unadjusted Trial Balance May 31, 2016 Debit Balances Credit Balances Cash Accounts Receivable Inventory 583,950 Estimated Retums Inventory 15,200 Prepaid Insurance 16,800 Accou Store Supplies 13,800 Store Equipment 569,500 Accumulated Depreciation-Store Equipment 56,700 Accounts Payable 63,150 Salaries Payable Accounts Payable 63,150 Salaries Payable Customers Refunds Payable 29,270 Common Stock 100,000 Retained Earnings 585,300 Dividends 135,000 Sales Cost of Goods Sold 3,013,000 Sales Salaries Expense w 720,800 Advertising Expense 292,000 Depreciation Expense Store Supplies Expense Miscellaneous Selling Expense 12,600 Office Salaries Expense 411,100 Rent Expense 88,700 Insurance Expense Miscellaneous Administrative Expense 7,800 Comprehensive Problem 2 Part 1 and Part 2 Palisade Creek Co. is a real business that uses the perpetual inventory system. The account balances to Vitae Creek as of May 1, 2010 (unless otherwise indicated), are as follows. Assume all accounts have normal balance 110 Cash $83,600 312 Dividends $135,000 112 Accounts Receivable 233,900 410 Sales 5,069.000 115 Inventory 624,400 510 Cost of Goods Sold 2,823,000 116 Estimated Returns Inventory 28,000 520 Sales Salaries Expense 664,800 117 Prepaid Insurance 16,800 521 Advertising Expense 281,000 118 Store Supplies 11,400 522 Depreciation Expense 123 Store Equipment 569,500 523 Store Supplies Expense 124 Accumulated Depreciation-Store Equipment 56,700 529 Miscellaneous Selling Expense 12,600 210 Accounts Payable 95,600 530 Office Salanes Expense 382,100 211 Salaries Payable 531 Rent Expense 33,700 212 Customers Refunds Payable 50,000 532 Insurance Expense 310 Common Stock 100,000 539 Miscellaneous Administrative Expense 7,800 311 Retained Earnings 585,300 Part 1: Journalize the transactions below for May, the last month of the fiscal year. If an amount box does not require an entry leave it blank May 1: Paid rent for May, $5,000 May 1: Paid rent for May, $5,000. Date Description May 1 Rent Expense Post. Ref. Debit Credit 5,000 Cash 5,000 May 2: Sold merchandise on account to Korman Co., terms /15, FOB shipping point, 568,500. The cost of the goods told was $41,000. Date Description Post. Ref. Debit Credit May 2 Accounts Receivable-Korman Co. 68,500 Sales 68,500 May 2 Cost of Goods Sold 41,000 Inventory 41,000 May 3: Purchased merchandise on account from Martin Co., terms 2/10, 1/30, FOB shipping point, 536,000. Date Description Post. Ref. Debit Credit May 3 Inventory 36,000 Accounts Payable-Martin Co. 36,000 May 4: Pand freight on purchase of May 3, $600. Darlin Dorption Poste May 4 Inventory Debat Credit 600 600 May 7: Received $22,300 cash from Halstad Co, on account Date Description Post. Rel Debit Credit May 7 th 22,300 Accounts Receivable-Halstad.co 22,300 May 10: Sold merchandise with a list price of $61,500 to customers who used VISA and who redeemed $7,500 of point-of-sale coupons. The cost of the goods sold was $32,000 Date Description Post. Rel. Debit May 10-Sales Cash 54,000 Sales 54,000 May 10-Cost Cost of Goods Sold 32,000 Inventory 32,000 May 13: Paid for merchandise purchased on May 3. Date Description Post. Ref. May 13 Accounts Payable-Martin Co. Debit Credit 36,000 Cash 35,280 Inventory 720 May 15: Paid advertising expense for last half of May, $11,000. Date Description Post. Ref. Debit Credit May 15 Advertising Expense 11,000 Cash 11,000 Post. Ref. Debit Credit May 17: Received cash from sale of May 2. Date Description May 17 Cash 68,500 68,500 Accounts Receivable-Korman Co. May 19: Purchased merchandise for cash, $18,700, Date Post Rel Debit Credit Description Inventory May 19 18,700 Cash 18,700 May 19: Paid $33,450 to Buttons Co. on account. Date Description May 19 Accounts Payable-Buttons Co. Post. Ref. Debit Credit 33,450 Cash 33,450 Date Post. Ref. Debit May 20: Paid Korman Co. a cash refund of $13,230 for returned merchandise from sale of May 2. The cost of the returned merchandise was $8,000. Description Credit May 20-Refund Customers Refunds Payable 13,230 13,230 Cash May 20-Cost Inventory 8,000 Estimated Returns Inventory 8,000 May 21: Sold merchandise on account to Crescent Co., terms w/com, FOB shipping point, $110,000. The cost of the goods sold was $70,000 Data Description Post. Rel Debit May 21 Sales Accounts Receivable Crescent Co. 108,900 Sales 108,900 May 21-Cost Cost of Goods Sold 70,000 Inventory 70,000 Date Dehit May 21: For the convenience of Crescent Co., paid freight on sale of May 21, $2,300. Description Post. Rel Credit May 21 Accounts Receivable Crescent Co. 2,300 Cash 2,300 May 21+ Received $42,900 cash from Gee Co. on account. Date Description Post Rel Debit Credit May 21 Cash 42,900 Accounts Receivable Gee co. 42,900 May 21: Purchased merchandise on account from Osterman Co., terms 1/10, 1/30, FOB destination, $88,000. Date Description Postitel Debit Credit May 21 Inventory 88,000 Accounts Payable-Osterman Co. 88,000 May 24: Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000. Date Description Post. Rel. Debit Credit May 24 Accounts Payable-Osterman Co. 5,000 Inventory 5,000 May 26: Refunded cash on sales made for cash, $7,500. The cost of the merchandise returned was $4,800, Date Description Post. Ref. Debit Credit May 26-Refund Customers Refunds Payable 7,500 Cash 7,500 May 26-Cost Inventory 4,800 Estimated Returns Inventory 4,800 May 28: Paid sales salaries of $56,000 and office salaries of $29,000. Dale Description Poster Debit May 28 Sales Salones Expense 56,000 Credit Office Salanes Expense 29,000 Cash 85,000 May 29: Purchased store supplies for cash, $2,400. Date Description Post. Rel Debit Credit May 29 Store Supplies 2,400 Cash 2,400 May 30: Sold merchandise on account to Turner Co., terms 1/30, FOB shipping point, $78,750. The cost of the goods sold was $47,000. Date Description Post, Rel. Debit Credit May 30-Sales Accounts Receivable-Turner Co. 78,750 Sales 78,750 May 30-Cost Cost of Goods Sold 47,000 Inventory 47,000 May 31: Received cash from sale of May 21 plus freight. Date Description Post. Ref. Debit Credit May 31 Cash 111,200 Accounts Receivable-Crescent Co. 113,300 May 31: Paid for purchase of May 21, less return of May 24. Date Description Post. Ref. Debit Credit May 31 Accounts Payable-Osterman Co. 83,000 Cash 82,170 Inventory 830