It is April 1, 2015, the first business day of the month, and you have just been hired as the accountant for Allarco Inc., which operates with monthly accounting periods. For simplicity, ignore all sales tax considerations and assume that Allarco Inc. sells one product. All of the company's accounting work has been completed through the end of March, 2015. Allarco Inc.'s year end is April 30. The post-closing alphabetized trial balance at March 31, 2015 follows.

Allarco Inc.

Post-Closing Trial Balance

March 31, 2015

Debit

Credit

Accounts receivable¹

162,000

Accounts payable²

459,000

Accumulated depreciation, store equipment

61,532

Allowance for doubtful accounts

16,200

Cash

1,146,547

Common shares³

70,000

Interest receivable⁴

244

Merchandise inventory⁵

1,200,000

Notes receivable⁴

65,000

Prepaid insurance⁶

20,500

Retained earnings

2,072,309

Store equipment⁷

105,750

Utilities payable

21,000

Totals

2,700,041

2,700,041

¹See the Accounts Receivable Subledger below for details regarding customer balances.

²See the Accounts Payable Subledger below for details regarding creditor balances.

³There are an unlimited number of shares authorized with 20,000 shares issued and outstanding as at March 31, 2015.

⁴This is a 9% note due March 15, 2018 with interest collectible on the 15th of each month. Refer to the collection schedule below for the note details. Values in schedule have been rounded for convenience.

⁵See the Merchandise Inventory Subledger below for details of inventory holdings.

⁶The balance in Prepaid Insurance represents payment for 4 months starting April 1, 2015.

⁷See the Property, Plant and Equipment Subledger below for detailed information.

You have determined that Allarco Inc. uses the moving weighted average cost flow assumption under a perpetual system to account for merchandise inventory and that the terms of all credit sales are 2/10, n/30. Merchandise sells for $213 per unit.

The following source documents are from April :