Journalize the closing entries. Then post the journal to the general ledger you created in part 1. Indicate closed accounts by inserting a line in both the balance columns opposite the closing entry. Insert the new balance in the owner's capital account.

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 blan Palisade Creek Co. Unadjusted Trial Balance May 31, 2017 Debit Balances Credit Balances Cash 99,430 Accounts Receivable 245,875 599,150 16,800 Merchandise Inventory Prepaid Insurance Store Supplies Store Equipment Accumulated Depreciation-Store Equipment 13,800 569,500 56,700 Accounts Payable 63,150 44,200 Customer Refunds Payable Salaries Payable Lynn Tolley, Capital Lynn Tolley, Drawing 685,300 135,000 Sales 5,376,205 3,013,000 720,800 292,000 Cost of Merchandise Sold Sales Salaries Expense Advertising Expense Depreciation Expense Store Supplies Expense Miscellaneous Selling Expense Office Salaries Expense 12,600 411,100 Rent Expense 88,700 Insurance Expense Miscellaneous Administrative Expense 7,800 6,225,555 6,225,555 Part 7: You must complete parts 1, 2, 3, 4 and 6 before completing part 7. Part 5 is the optional work sheet. Prepare an adjusted trial balance. If an amount box does not require an entry, leave it blank. Palisade Creek Co. Adjusted Trial Balance May 31, 2017 Debit Balances Credit Balances 99,430 Cash Accounts Receivable 245,875 585,200 4,800 4,000 569,500 70,700 Merchandise Inventory Prepaid Insurance Store Supplies Store Equipment Accumulated Depreciation-Store Equipment Accounts Payable Customer Refunds Payable Salaries Payable Lynn Tolley, Capital Lynn Tolley, Drawing 63,150 13,600 685,300 135,000 Sales 5,316,205 3,026,950 727,800 292,000 14,000 Cost of Merchandise Sold Sales Salaries Expense Advertising Expense Depreciation Expense Store Supplies Expense Miscellaneous Selling Expense Office Salaries Expense Rent Expense 9,800 12,600 417,700 88,700 Insurance Expense 12,000 Miscellaneous Administrative Expense 7,800 6,253,155 6,253,155 Enter the unadjusted trial balance on a 10-column end-of-period spreadsheet (work sheet), and complete the spreadsheet using the following adjustment data. $585,200 a. Merchandise inventory on May 31 b. Insurance expired during the year 12,000 4,000 c. Store supplies on hand on May 31 14,000 d. Depreciation for the current year e. Accrued salaries on May 31: Sales salaries $7,000 orice salaries 6,600 13.600 1. The adjustment for customer refunds and allowances is $60,000. If an amount box does not require an entry, leave it blank. Palisade Creek Co. End-of-Period Spreadsheet (Work Sheet) For the Year Ended May 31, 2017 Unadjusted Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet Account Title Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit Cash Accounts Receivable Merchandise Inventory Prepaid Insurance Store Supplies Store Equipment Accum. Depr.-Store Equip. Accounts Payable Customer Refunds Payable Salaries Payable Lynn Tolley, Capital Lynn Tolley, Drawing Sales Cost of Merchandise Sold Sales Salaries Expense Advertising Expense Depreciation Expense Store Supplies Expense Miscellaneous Selling Expense Office Salaries Expense Rent Expense Insurance Expense Miscellaneous Admin. Expense Net Income Part 4 and 5: 12,000 4,000 Note: You must complete parts 1, 2 and 3 before attempting to complete part 4 and part 6. Part 5 is an optional work sheet. 4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete Part 6. a. Merchandise inventory on May 31 $585,200 b. Insurance expired during the year C. Store supplies on hand on May 31 d. Depreciation for the current year 14,000 e. Accrued salaries on May 31: Sales salaries $7,000 Office salaries f. The adjustment for customer refunds and allowances is $60,000. 6. Journalize the adjusting entries. If an amount box does not require an entry, leave it blank. Post the adjusting entries to the attached spreadsheet you used in parts 1 and 2. Page 22 6,600 13,600 Post. Date Description Debit Credit Ref. Adjusting Entries 2017 13,950 May 31 Cost of Merchandise Sold Merchandise Inventory 13,950 12,000 May 31 Insurance Expense Prepaid Insurance 12,000 9,800 May 31 Store Supplies Expense Store Supplies 9,800 14,000 May 31 Depreciation Expense Accumulated Depreciation-Store Equipment 14,000 7,000 May 31 Sales Salaries Expense Office Salaries Expense Salaries Payable 6,600 13,600 May 31 Sales 60,000 V Customer Refunds Payable 60,000 Part 8: You must complete parts 1, 2, 3, 4, 6 and 7 before attempting to complete part 8. Note: part 5 is optional. 1. Prepare an income statement. Palisade Creek Co. Income Statement For the Year Ended May 31, 2047 Sales Cost of merchandise sold Gross profit $ Expenses: Selling expenses: Sales salaries expense $ Advertising expense Store supplies expense Total selling expenses Administrative expenses: $ Total administrative expenses Total expenses Net income 3. Prepare a balance sheet. Palisade Creek Co. Balance Sheet May 31, 2017 Assets Current assets: Cash Accounts receivable Merchandise inventory Prepaid insurance Store supplies Total current assets Property, plant, and equipment: Store equipment Less accumulated depreciation Total property, plant, and equipment Total assets Total current assets $ Property, plant, and equipment: Store equipment Less accumulated depreciation Total property, plant, and equipment Total assets Liabilities Current liabilities: Accounts payable Customer refunds payable Salaries payable Total liabilities Owner's equity Total liabilities and owner's equity Page 23 Date Description Post. Ref. Debit Credit Closing Entries 2017 May 31 IT May 31 May 31 Palisade Creek Co. Post-Closing Trial Balance May 31, 2017 Debit Balances Credit Balances Cash Accounts Receivable Merchandise Inventory Prepaid Insurance Store Supplies Store Equipment Accumulated Depreciation Store Equipment Accounts Payable Customer Refunds Payable Salaries Payable Lynn Tolley, Capital