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*kindly include the explanation for no. 6 Adjusting Entry *Adjusted Trial Balance *Income Statement *Balance Sheet THANK YOU The Sandhill Shop, owned by Andrew John,

*kindly include the explanation for no. 6 Adjusting Entry *Adjusted Trial Balance *Income Statement *Balance Sheet THANK YOU

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The Sandhill Shop, owned by Andrew John, sells skateboards in the summer and snowboards in the winter. The shop has an August 31 fiscal year end, and uses a perpetual inventory system and the earnings approach. On August 1, 2024, the company had the following balances in its general ledger: Durng August, the last month of the fiscal year, the company had the following transactions: Aug. 1 Paid $1,720 for August's rent. 2 Paid $6,500 of the amount included in Accounts Payable. 4 Sold merchandise costing $7,900 for $12,700 cash. 5 Purchased merchandise on account from Orange Line Co., n/30, FOB shipping point, for $24,300. 5 Paid freight charges of $480 on merchandise purchased from Orange Line Co. 8 Purchased supplies on account for $345. 9 Refunded a customer $425 cash for returned merchandise. The merchandise had cost $260 and was returned to inventory. 10 Sold merchandise on account to Spider Company for $16,000, terms 2/10,n/30, FOB shipping point. The merchandise had a cost of $9,645. 11 Paid Orange Line Co. for half of the merchandise purchased on August 5. 12 Spider Company returned $750 of the merchandise it purchased. Sandhill Shop issued Spider a credit to its account. The merchandise had a cost of $461 and was returned to inventory. 15 Paid salaries, $3,180. 19 Spider Company paid the amount owing. 21 Purchased $9,800 of merchandise from Rainbow Option Co. on account, terms 2/10,n/30, FOB destination. 23 Returned $800 of the merchandise to Rainbow Option C. and received a credit on the account. 23 Returned $800 of the merchandise to Rainbow Option Co. and received a credit on the account. 24 Received $522 cash in advance from customers for merchandise to be delivered in September. 30 Paid salaries, $3,180. 30 Paid Rainbow Option Co. the amount owing. 31 Andrew John withdrew $4,700 cash. Adjustment and additional data: 1. A count of supplies on August 31 shows $820 on hand. 2. The equipment has an estimated eight-year useful life. Remember that adjusting entries are done annually, not monthly. 3. Of the notes payable, $6,000 must be paid on September 1 each year. 4. (1) An analysis of the Unearned Revenue account shows that $3,800 has been earned by August 31. (2) A corresponding entry of $2,385 for Cost of Goods Sold will also need to be recorded for these sales. 5. Interest accrued on the note payable to August 31 was $225. 6. A count of the merchandise inventory on August 31 shows $76,700 of inventory on hand

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