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HML Company had the following account balances at December 31 year-end: cost of goods sold $85,000; inventory $15,000; operating expenses $39,000; sales revenue $144,000; sales
HML Company had the following account balances at December 31 year-end: cost of goods sold $85,000; inventory $15,000; operating expenses $39,000; sales revenue $144,000; sales discounts $1,600; sales returns and allowances $2,400; and dividends $1,500. A physical count of inventory determines that inventory on hand is $14,500. Required: Answer the following TWO parts. (a) Prepare the adjusting entry necessary as a result of the physical count. (Note: Do not create a new account here.) (b) Prepare closing entries in four steps
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