COMPREHENSIVE PROBLEM rehensive Problem for Chapters 5 a Co Davis Lamp Company (DLC), owned by Jenny Davis, is a wholesale c rchases lamps from the manufacturer and resells them to retail stores. The a wholesale company that purch has three inventory items: desk lamps, table lamps, and floor lamps, DLC a perpetual invento Cerpetual inventory system, FIFO method. DLC owns land with a building usesh is separated into two parts: office space and warcehouse space. All expenses cated with the office are categorized as Administrative Expenses. All expenses associated with the warehouse, which is used for the shipping and receiving functions the company, are categorized as Selling Expenses. In addition to the land and build- DLC also owns office furniture and equipment and warebouse fixtures. The com- associat ing. or uses one accumulated depreciation account for all the depreciable assets. The trial balance for DL.C as of September 30, 2018 follows: DAVIS LAMP COMPANY Trial Balance September 30, 2018 Balance Account Debit Credit Cash $ 457,000 Accounts Receivable Merchandise Inventory Office Supplies 126,000 275 Warehouse Supplies 350 Land 20,000 Building 780,000 Office Furniture and Equipment 125,000 260,000 Warehouse Fixtures $ 194,000 Accumulated Depreciation Accounts Payable 398,925 Davis, Capital Davis, Withdrawals 2,654,150 Sales Revenue 1,061,450 Cost of Goods Sold 270,000 Salaries Expense-Selling 32,000 Utilities Expense-Selling Supplies Expense-Selling Depreciation Expense-Selling 90,000 Salaries Expense-Administrative 25,000 Utilities Expense-Administrative Supplies Expense-Administrative Depreciation Expense-Administrative 3,247,075 $3,247,075 Total the following lamps Merchandise Inventory as of September 30 consists of the olwing Unit Cost Total Cost Quantity Item 20,000 2,500 Desk Lamp 18 54,000 3,000 Table Lamp 26 52,000 2,000 Floor Lamp 126,000 Total During the fourth quarter of 2018, DLC completed the following Purchased lamps on account from Blue Ridge Lights, terms n/30, OB destinatiou 5,000 desk lamps at $9 each Oct. 1 7,500 table lamps at $19 each 2,500 floor lamps at $25 each 12 Sold lamps on account to Atlas Home Furnishings, terms 2/10, n/30 4,000 table lamps at $45 each Sold lamps on account to Hiawassee Office Supply, terms 2/10, n/30: 1,000 desk lamps at $20 each 15 Received a check from Atlas Home Furnishings for full amount owed on Oct. 20 12 sale. Received a check from Hiawassee Office Supply for full amount owed on Oct 23 15 sale. Sold lamps on account to Parkway Home Stores, terms 2/10, n/30: 28 3,500 table lamps at $45 each 1,500 floor lamps at $65 each 30 Paid amount due to Blue Ridge Lights from Oct. 1 purchase. Paid salaries, $40,000 (75% selling, 25% administrative). 31 Paid utilities, $2,500 (60% selling, 40% administrative). 31 Nov. 1 Sold lamps on account to Hiawassee Office Supply, terms 2/10, r0: 3,000 desk lamps at $20 each Purchased lamps on account from Blue Ridge Lights, terms n/30, FC Mestination: 5,000 desk lamps at $10 each 5 10,000 table lamps at $21 each 5,000 floor lamps at $27 each Received a check from Parkway Home Stores for full amount owed on Oct. 28 sale. 5 Received a check from Hiawassee Office Supply for full amount owed on Nov 1 sale. 8 Purchased and paid for supplies: $325 for the office: $675 for the warehouse. Sold lamps on account to Anderson Office Supply, n/30: 10 15 2,000 desk lamps at $20 each Sold lamps on account to Go-Mart Discount Stores, terms 1/10, n/30: 18 2,000 table lamps at $45 each 2,000 floor lamps at $65 each Received a check from Go-Mart Discount Stores for full amount owed on 28 18 sale. Merchandise Invento dsalaries, $40,000 (75% selling, 25% administrative). utilities, $2,670 (60% selling, 40% administrative). Paid 30 Paid amount due to Blue Ridge Lights from Nov. 5 purchase ved a check from Anderson Office Supply for full amount owed on Nov. s 15 sale. Davis withdrew $50,000 from the business. 15 Sold lamps on account to Atlas Home Furnishings, terms 2/10, n/30: 4,500 desk lamps at $20 each 5,000 table lamps at $45 each 27 paid salaries, $40,000 (75% selling, 25% administrative). 31 Paid utilities, $3,200 (60% selling, 40% administrative). 31 (00 /o selling, 40% administrative) 31 Paid utu Requirements 1, Open general ledger T-accounts and enter opening balances as of September 30,2018. nventory records for the three inventory items and enter opening balances mber 30, 2018. Complete the inventory records using the following transactions: Oct. 1, 12, 15, 28; Nov. 1, 5, 15, 18, and Dec. 27. 3. Record the transactions in the general journal. 4. Post transactions to the general ledger 5. Prepare adjusting entries for the year ended December 31, 2018, and post to the ledger: a. Depreciation, $48,500 (75% selling, 25% administrative). b. Supplies on hand: office, $200, and warehouse, $650. c. A physical inventory account resulted in the following counts: desk lamps, 1,990; nips table lam 6. Prepare an adjusted trial balance. 7. Provide a summary for the month, in both units and dollars, of the change in inventory for each item in the following format: Desk Lamps Table Lamps Floor Lamps DollarNumberDcilarNumber oar Number of lamps Amount of lamps Amount Beginning Balance Add: Purchases Less: COGS Ending Balance Does the sum of the ending balances in the inventory records match the balance in Merchandise Inventory in the general ledger? If not, review the transactions to find your error. oner's equity for the year ended December 31, 2018, and a classified balande sheet as of December 31, 2018. frepare Davis Lamp Company's muli-step income statement and statement of 9. Calculate the following ratios for DLC as of December 31, 2018: gross profir percentage, inventory turnover, and days' sales in inventory 10. Record and post the closing entries. 11. Prepare a post-closing trial balance. COMPREHENSIVE PROBLEM rehensive Problem for Chapters 5 a Co Davis Lamp Company (DLC), owned by Jenny Davis, is a wholesale c rchases lamps from the manufacturer and resells them to retail stores. The a wholesale company that purch has three inventory items: desk lamps, table lamps, and floor lamps, DLC a perpetual invento Cerpetual inventory system, FIFO method. DLC owns land with a building usesh is separated into two parts: office space and warcehouse space. All expenses cated with the office are categorized as Administrative Expenses. All expenses associated with the warehouse, which is used for the shipping and receiving functions the company, are categorized as Selling Expenses. In addition to the land and build- DLC also owns office furniture and equipment and warebouse fixtures. The com- associat ing. or uses one accumulated depreciation account for all the depreciable assets. The trial balance for DL.C as of September 30, 2018 follows: DAVIS LAMP COMPANY Trial Balance September 30, 2018 Balance Account Debit Credit Cash $ 457,000 Accounts Receivable Merchandise Inventory Office Supplies 126,000 275 Warehouse Supplies 350 Land 20,000 Building 780,000 Office Furniture and Equipment 125,000 260,000 Warehouse Fixtures $ 194,000 Accumulated Depreciation Accounts Payable 398,925 Davis, Capital Davis, Withdrawals 2,654,150 Sales Revenue 1,061,450 Cost of Goods Sold 270,000 Salaries Expense-Selling 32,000 Utilities Expense-Selling Supplies Expense-Selling Depreciation Expense-Selling 90,000 Salaries Expense-Administrative 25,000 Utilities Expense-Administrative Supplies Expense-Administrative Depreciation Expense-Administrative 3,247,075 $3,247,075 Total the following lamps Merchandise Inventory as of September 30 consists of the olwing Unit Cost Total Cost Quantity Item 20,000 2,500 Desk Lamp 18 54,000 3,000 Table Lamp 26 52,000 2,000 Floor Lamp 126,000 Total During the fourth quarter of 2018, DLC completed the following Purchased lamps on account from Blue Ridge Lights, terms n/30, OB destinatiou 5,000 desk lamps at $9 each Oct. 1 7,500 table lamps at $19 each 2,500 floor lamps at $25 each 12 Sold lamps on account to Atlas Home Furnishings, terms 2/10, n/30 4,000 table lamps at $45 each Sold lamps on account to Hiawassee Office Supply, terms 2/10, n/30: 1,000 desk lamps at $20 each 15 Received a check from Atlas Home Furnishings for full amount owed on Oct. 20 12 sale. Received a check from Hiawassee Office Supply for full amount owed on Oct 23 15 sale. Sold lamps on account to Parkway Home Stores, terms 2/10, n/30: 28 3,500 table lamps at $45 each 1,500 floor lamps at $65 each 30 Paid amount due to Blue Ridge Lights from Oct. 1 purchase. Paid salaries, $40,000 (75% selling, 25% administrative). 31 Paid utilities, $2,500 (60% selling, 40% administrative). 31 Nov. 1 Sold lamps on account to Hiawassee Office Supply, terms 2/10, r0: 3,000 desk lamps at $20 each Purchased lamps on account from Blue Ridge Lights, terms n/30, FC Mestination: 5,000 desk lamps at $10 each 5 10,000 table lamps at $21 each 5,000 floor lamps at $27 each Received a check from Parkway Home Stores for full amount owed on Oct. 28 sale. 5 Received a check from Hiawassee Office Supply for full amount owed on Nov 1 sale. 8 Purchased and paid for supplies: $325 for the office: $675 for the warehouse. Sold lamps on account to Anderson Office Supply, n/30: 10 15 2,000 desk lamps at $20 each Sold lamps on account to Go-Mart Discount Stores, terms 1/10, n/30: 18 2,000 table lamps at $45 each 2,000 floor lamps at $65 each Received a check from Go-Mart Discount Stores for full amount owed on 28 18 sale. Merchandise Invento dsalaries, $40,000 (75% selling, 25% administrative). utilities, $2,670 (60% selling, 40% administrative). Paid 30 Paid amount due to Blue Ridge Lights from Nov. 5 purchase ved a check from Anderson Office Supply for full amount owed on Nov. s 15 sale. Davis withdrew $50,000 from the business. 15 Sold lamps on account to Atlas Home Furnishings, terms 2/10, n/30: 4,500 desk lamps at $20 each 5,000 table lamps at $45 each 27 paid salaries, $40,000 (75% selling, 25% administrative). 31 Paid utilities, $3,200 (60% selling, 40% administrative). 31 (00 /o selling, 40% administrative) 31 Paid utu Requirements 1, Open general ledger T-accounts and enter opening balances as of September 30,2018. nventory records for the three inventory items and enter opening balances mber 30, 2018. Complete the inventory records using the following transactions: Oct. 1, 12, 15, 28; Nov. 1, 5, 15, 18, and Dec. 27. 3. Record the transactions in the general journal. 4. Post transactions to the general ledger 5. Prepare adjusting entries for the year ended December 31, 2018, and post to the ledger: a. Depreciation, $48,500 (75% selling, 25% administrative). b. Supplies on hand: office, $200, and warehouse, $650. c. A physical inventory account resulted in the following counts: desk lamps, 1,990; nips table lam 6. Prepare an adjusted trial balance. 7. Provide a summary for the month, in both units and dollars, of the change in inventory for each item in the following format: Desk Lamps Table Lamps Floor Lamps DollarNumberDcilarNumber oar Number of lamps Amount of lamps Amount Beginning Balance Add: Purchases Less: COGS Ending Balance Does the sum of the ending balances in the inventory records match the balance in Merchandise Inventory in the general ledger? If not, review the transactions to find your error. oner's equity for the year ended December 31, 2018, and a classified balande sheet as of December 31, 2018. frepare Davis Lamp Company's muli-step income statement and statement of 9. Calculate the following ratios for DLC as of December 31, 2018: gross profir percentage, inventory turnover, and days' sales in inventory 10. Record and post the closing entries. 11. Prepare a post-closing trial balance