I need an explanation and solution please

Problem 4-5A Preparing adjusting entries and income statements; computing gross margin, acid-test, and current ratios LO A1, A2, P3, P4 (The following information applies to the questions displayed below The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. Nelson company uses a perpetual inventory system. It categorizes the following accounts as selling expenses: Depreciation Expense-Store Equipment, Sales Salaries Expense, Rent Expense-Selling Space, Store Supplies Expense, and Advertising Expense. It categorizes the remaining expenses as general and administrative. NELSON COMPANY Unadjusted Trial Balance January 31 Credit Debit S 23, 300 Cash Merchandise inventory 13,000 5, 400 2, 300 43, 000 Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable Common stock Retained earnings Dividends $18, 800 13, 000 6, 000 26, 000 2, 100 44C Enn Dividends Sales 2, 100 116, 500 Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Sales salaries expense office salaries expense Insurance expense Rent expense-Selling space Rent expense-Office space Store supplies expense Advertising expense 1, 850 2,050 38, 000 12,950 12,950 E 7,008 7, 000 9, 400 Totals $180, 300 $180, 300 Additional Information: a. Store supplies still available at fiscal year-end amount to $2,800. b. Expired insurance, an administrative expense, is $1,700 for the fiscal year c. Depreciation expense on store equipment, a selling expense, is $1,625 for the fiscal year d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,100 of inventory is still available at fiscal year-end. es 5 6 3 4 1 2 co Next> of 6 Prev Required information Journal entry worksheet