P3-4 (Financial Statements, Adjusting and Closing Entries) The trial balance of Bellemy Fashion Center contained the following accounts at November 30, the end of the company's fiscal year. BELLEMY FASHION CENTER Trial Balance November 30, 2010 Debit Credit Cash $28,700 Accounts Receivable 33,700 Merchandise Inventory 45,000 Store Supplies 5,500 Store Equipment 85,000 Acc. Depreciation - Store Equipment $18,000 Delivery Equipment 48,000 Acc. Depreciation - Delivery Equipment 6,000 Notes Payable 51,000 Accounts Payable 48,500 Common Stock 90,000 Retained Earnings 8,000 Sales 757,200 Sales Returns and Allowances 4,200 Cost of Goods Sold 495,400 Salaries Expense 140,000 Advertising Expense 26,400 Utilities Expense 14,000 Repair Expense 12,100 Delivery Expense 16,700 Rent Expense 24,000 $978,700 $978,700 Adjustment data: Store supplies on hand totaled $1,500. Depreciation is $9,000 on the store equipment and $6,000 on the delivery equipment. Interest of $11,000 is accrued on notes payable at November 30. Other data: Salaries expense is 70% selling and 30% administrative. Rent expense and utilities expense are 80% selling and 20% administrative. $30,000 of notes payable are due for payment next year. Repair expense is 100% administrative. Journalize the adjusting entries. Date Description/Account Debit Credit Nov. 30 Store Supplies ExpenseStore SuppliesInterest ExpenseInterest PayableDepr. Expense-Store Equip.Acc. Depr.-Store Equip.Depr. Expense-Del. Equip.Acc. Depr.-Del. Equip. Interest ExpenseInterest PayableDepr. Expense-Store Equip.Acc. Depr.-Store Equip.Acc. Depr.-Del. Equip.Depr. Expense-Del. Equip.Store SuppliesStore Supplies Expense (To record store supplies) Nov. 30 Store Supplies ExpenseDepr. Expense-Store Equip.Interest ExpenseStore SuppliesAcc. Depr.-Del. Equip.Interest PayableAcc. Depr.-Store Equip.Depr. Expense-Del. Equip. Depr. Expense-Store Equip.Interest PayableDepr. Expense-Del. Equip.Store SuppliesAcc. Depr.-Del. Equip.Acc. Depr.-Store Equip.Store Supplies ExpenseInterest Expense (To record depreciation on store equipment) Nov. 30 Interest ExpenseDepr. Expense-Del. Equip.Acc. Depr.-Del. Equip.Store Supplies ExpenseAcc. Depr.-Store Equip.Interest PayableStore SuppliesDepr. Expense-Store Equip. Interest PayableStore SuppliesDepr. Expense-Del. Equip.Depr. Expense-Store Equip.Store Supplies ExpenseAcc. Depr.-Store Equip.Interest ExpenseAcc. Depr.-Del. Equip. (To record depreciation on delivery equipment) Nov. 30 Store Supplies ExpenseAcc. Depr.-Del. Equip.Depr. Expense-Store Equip.Depr. Expense-Del. Equip.Interest PayableInterest ExpenseAcc. Depr.-Store Equip.Store Supplies Store Supplies ExpenseStore SuppliesDepr. Expense-Del. Equip.Interest ExpenseDepr. Expense-Store Equip.Interest PayableAcc. Depr.-Store Equip.Acc. Depr.-Del. Equip. (To record interest.) Prepare an adjusted trial balance. (If answer is zero, please enter 0, do not leave any fields blank.) BELLEMY FASHION CENTER Adjusted Trial Balance November 30, 2010 Debit Credit Cash $ $ Accounts Receivable Merchandise Inventory Store Supplies Store Equipment Accumulated Depreciation - Store Equipment Delivery Equipment Accumulated Depreciation - Delivery Equipment Notes Payable Accounts Payable Common Stock Retained Earnings Sales Sales Returns and Allowances Cost of Goods Sold Salaries Expense Advertising Expense Utilities Expense Repair Expense Delivery Expense Rent Expense Store Supplies Expense Depreciation Expense - Store Equipment Depreciation Expense - Delivery Equipment Interest Expense Interest Payable Totals $ $ Prepare a multiple-step income statement and retained earnings statement for the year and a classified balance sheet as of November 30, 2010. (For income statement list multiple items in order from largest to smallest amount, e.g. 15, 11, 5. For the balance sheet list current assets in order of liquidity and current liabilities with notes payable first and the other items in order from largest to smallest amounts, e.g. 15, 11, 5.) BELLEMY FASHION CENTER Income Statement For the Year Ended November 30, 2010 Sales Revenue Interest expenseAdvertising expenseDelivery expenseSalesDepr. exp.-Del. equip.Sales returns and allowancesRepair expenseSalaries expenseRent expenseUtilities expenseDepr. exp.-Store equip.Stores supplies expense $ Less: Stores supplies expenseSalesInterest expenseDelivery expenseSales returns and allowancesDepr. exp.-Store equip.Salaries expenseAdvertising expenseRent expenseUtilities expenseDepr. exp.-Del. equip.Repair expense Net sales Cost of goods sold Gross profit Operating expenses Selling expenses Stores supplies expenseDepr. exp.-Store equip.Advertising expenseSalesRent expenseSales returns and allowancesRepair expenseDepr. exp.-Del. equip.Interest expenseDelivery expenseUtilities expenseSalaries expense $ Depr. exp.-Del. equip.Sales returns and allowancesInterest expenseAdvertising expenseSalaries expenseRent expenseRepair expenseDelivery expenseUtilities expenseDepr. exp.-Store equip.Stores supplies expenseSales Depr. exp.-Del. equip.Sales returns and allowancesAdvertising expenseStores supplies expenseDepr. exp.-Store equip.Interest expenseRepair expenseDelivery expenseRent expenseSalaries expenseSalesUtilities expense Advertising expenseSalesRent expenseUtilities expenseInterest expenseDepr. exp.-Store equip.Sales returns and allowancesDepr. exp.-Del. equip.Stores supplies expenseRepair expenseDelivery expenseSalaries expense Salaries expenseInterest expenseAdvertising expenseSales returns and allowancesStores supplies expenseRepair expenseRent expenseDelivery expenseDepr. exp.-Store equip.Depr. exp.-Del. equip.SalesUtilities expense Depr. exp.-Store equip.Repair expenseInterest expenseAdvertising expenseSales returns and allowancesSalesSalaries expenseRent expenseDelivery expenseUtilities expenseDepr. exp.-Del. equip.Stores supplies expense Rent expenseDepr. exp.-Store equip.Depr. exp.-Del. equip.Interest expenseSales returns and allowancesSalesSalaries expenseDelivery expenseRepair expenseUtilities expenseAdvertising expenseStores supplies expense Repair expenseAdvertising expenseDelivery expenseRent expenseUtilities expenseDepr. exp.-Store equip.Depr. exp.-Del. equip.Interest expenseSalesSales returns and allowancesStores supplies expenseSalaries expense Total selling expenses $ Administrative expenses Depr. exp.-Store equip.Utilities expenseDelivery expenseDepr. exp.-Del. equip.Stores supplies expenseAdvertising expenseRepair expenseInterest expenseRent expenseSalaries expenseSalesSales returns and allowances Repair expenseDepr. exp.-Store equip.Utilities expenseRent expenseDelivery expenseSalesInterest expenseDepr. exp.-Del. equip.Stores supplies expenseSales returns and allowancesSalaries expenseAdvertising expense Utilities expenseDepr. exp.-Store equip.Interest expenseSales returns and allowancesRent expenseSalaries expenseSalesAdvertising expenseDelivery expenseDepr. exp.-Del. equip.Stores supplies expenseRepair expense Advertising expenseRent expenseInterest expenseDelivery expenseDepr. exp.-Store equip.Salaries expenseStores supplies expenseDepr. exp.-Del. equip.Repair expenseUtilities expenseSalesSales returns and allowances Total administrative expenses Total operating expenses Income from operations Other expenses and losses Salaries expenseDepr. exp.-Del. equip.Delivery expenseSales returns and allowancesStores supplies expenseSalesRent expenseInterest expenseUtilities expenseDepr. exp.-Store equip.Repair expenseAdvertising expense Net LossIncome $ BELLEMY FASHION CENTER Retained Earnings Statement For the Year Ended November 30, 2010 Retained earnings, Nov. 30, 2010Retained earnings, Dec. 1, 2009Net incomeNet loss $ Less: Retained earnings, Nov. 30, 2010Net lossRetained earnings, Dec. 1, 2009Net income Retained earnings, Nov. 30, 2010Net incomeNet lossRetained earnings, Dec. 1, 2009 $ BELLEMY FASHION CENTER Balance Sheet November 30, 2010 Assets Current assets Acc. depr.-Delivery equip.Notes payable due next yearMerchandise inventoryInterest payableCommon stockStore suppliesAcc. depr.-Store equip.Accounts receivableDelivery equip.Accounts payableNotes payableRetained earningsCash $ Notes payableAcc. depr.-Store equip.Acc. depr.-Delivery equip.Notes payable due next yearDelivery equip.CashCommon stockStore suppliesAccounts payableAccounts receivableRetained earningsMerchandise inventoryInterest payable Merchandise inventoryRetained earningsInterest payableStore suppliesAcc. depr.-Store equip.Accounts receivableNotes payableDelivery equip.Common stockAcc. depr.-Delivery equip.Accounts payableCashNotes payable due next year Accounts receivableCashAcc. depr.-Store equip.Delivery equip.Store suppliesNotes payable due next yearAccounts payableAcc. depr.-Delivery equip.Interest payableNotes payableCommon stockRetained earningsMerchandise inventory Total current assets $ Property, plant, and equipment Store equipment $ Less: Acc. depr.-Delivery equip.Common stockNotes payableCashMerchandise inventoryStore suppliesRetained earningsNotes payable due next yearInterest payableAcc. depr.-Store equip.Accounts payableAccounts receivableDelivery equip. Acc. depr.-Delivery equip.Accounts receivableDelivery equip.Notes payableInterest payableAcc. depr.-Store equip.Common stockRetained earningsNotes payable due next yearAccounts payableMerchandise inventoryCashStore supplies Less: Notes payable due next yearAcc. depr.-Store equip.Store suppliesDelivery equip.Interest payableAccounts payableAcc. depr.-Delivery equip.Common stockAccounts receivableCashNotes payableRetained earningsMerchandise inventory Total assets $ Liabilities and Stockholders' Equity Current Liabilities Notes payable due next yearCashCommon stockStore suppliesMerchandise inventoryAccounts receivableNotes payableInterest payableAcc. depr.-Store equip.Retained earningsDelivery equip.Acc. depr.-Delivery equip.Accounts payable $ Accounts receivableInterest payableMerchandise inventoryCashStore suppliesAcc. depr.-Store equip.Acc. depr.-Delivery equip.Delivery equip.Notes payable due next yearRetained earningsAccounts payableNotes payableCommon stock Common stockNotes payable due next yearAcc. depr.-Delivery equip.Store suppliesRetained earningsAcc. depr.-Store equip.CashMerchandise inventoryInterest payableAccounts payableNotes payableAccounts receivableDelivery equip. Total current liabilities $ Long-term liabilities Accounts receivableCashAcc. depr.-Store equip.Retained earningsMerchandise inventoryStore suppliesCommon stockInterest payableNotes payableNotes payable due next yearDelivery equip.Acc. depr.-Delivery equip.Accounts payable Total liabilities Stockholders' equity Interest payableNotes payable due next yearNotes payableDelivery equip.Common stockRetained earningsStore suppliesCashAccounts receivableAccounts payableMerchandise inventoryAcc. depr.-Store equip.Acc. depr.-Delivery equip. Notes payable due next yearStore suppliesCashAccounts receivableAcc. depr.-Store equip.Interest payableMerchandise inventoryDelivery equip.Notes payableAcc. depr.-Delivery equip.Accounts payableCommon stockRetained earnings Total liabilities and stockholders' equity $ Journalize the closing entries. (List multiple entries from largest to smallest amount, e.g. 10, 5, 2.) Date Description/Account Debit Credit Nov. 30 Salaries expenseUtilities expenseAdvertising expenseDepr. exp.-Store equip.Retained earningsSalesCost of goods soldDepr. exp.-Del. equip.Interest expenseIncome summaryRent expenseSales returns and allowancesStore supplies expenseRepair expenseDelivery expense Utilities expenseCost of goods soldInterest expenseSales returns and allowancesDelivery expenseRetained earningsIncome summaryDepr. exp.-Store equip.SalesSalaries expenseAdvertising expenseRepair expenseRent expenseStore supplies expenseDepr. exp.-Del. equip. (To close sales.) Nov. 30 SalesDepr. exp.-Del. equip.Income summaryRent expenseUtilities expenseAdvertising expenseRetained earningsRepair expenseDelivery expenseStore supplies expenseSales returns and allowancesInterest expenseDepr. exp.-Store equip.Cost of goods soldSalaries expense SalesAdvertising expenseRent expenseStore supplies expenseInterest expenseDepr. exp.-Store equip.Depr. exp.-Del. equip.Income summaryUtilities expenseSales returns and allowancesRetained earningsCost of goods soldSalaries expenseRepair expenseDelivery expense Interest expenseSalaries expenseCost of goods soldRent expenseAdvertising expenseSales returns and allowancesDepr. exp.-Store equip.Utilities expenseRepair expenseIncome summarySalesDelivery expenseStore supplies expenseDepr. exp.-Del. equip.Retained earnings Income summaryRent expenseSalesSales returns and allowancesCost of goods soldDelivery expenseStore supplies expenseUtilities expenseSalaries expenseDepr. exp.-Store equip.Repair expenseDepr. exp.-Del. equip.Interest expenseRetained earningsAdvertising expense Advertising expenseUtilities expenseDepr. exp.-Del. equip.Repair expenseDepr. exp.-Store equip.Store supplies expenseDelivery expenseRent expenseInterest expenseRetained earningsSalesIncome summarySales returns and allowancesCost of goods soldSalaries expense Delivery expenseRent expenseInterest expenseStore supplies expenseSalaries expenseIncome summarySalesRetained earningsSales returns and allowancesCost of goods soldAdvertising expenseUtilities expenseRepair expenseDepr. exp.-Store equip.Depr. exp.-Del. equip. Advertising expenseDelivery expenseDepr. exp.-Del. equip.Store supplies expenseIncome summaryUtilities expenseSalesInterest expenseSales returns and allowancesRepair expenseDepr. exp.-Store equip.Rent expenseRetained earningsCost of goods soldSalaries expense Store supplies expenseRetained earningsSalesDepr. exp.-Store equip.Depr. exp.-Del. equip.Cost of goods soldRent expenseInterest expenseSalaries expenseRepair expenseAdvertising expenseUtilities expenseIncome summarySales returns and allowancesDelivery expense Depr. exp.-Del. equip.Interest expenseDepr. exp.-Store equip.Retained earningsUtilities expenseRent expenseSalesIncome summaryRepair expenseSales returns and allowancesCost of goods soldSalaries expenseAdvertising expenseDelivery expenseStore supplies expense Store supplies expenseSalaries expenseDelivery expenseInterest expenseDepr. exp.-Del. equip.Advertising expenseRent expenseSalesIncome summaryRetained earningsDepr. exp.-Store equip.Sales returns and allowancesCost of goods soldUtilities expenseRepair expense Depr. exp.-Del. equip.Store supplies expenseAdvertising expenseUtilities expenseSalesSalaries expenseDepr. exp.-Store equip.Retained earningsRepair expenseIncome summaryCost of goods soldSales returns and allowancesInterest expenseDelivery expenseRent expense Delivery expenseAdvertising expenseSales returns and allowancesInterest expenseSalaries expenseDepr. exp.-Del. equip.Rent expenseStore supplies expenseDepr. exp.-Store equip.Retained earningsIncome summarySalesCost of goods soldUtilities expenseRepair expense Delivery expenseRent expenseAdvertising expenseDepr. exp.-Store equip.Repair expenseUtilities expenseDepr. exp.-Del. equip.Salaries expenseSalesInterest expenseCost of goods soldRetained earningsStore supplies expenseIncome summarySales returns and allowances (To close accounts.) Nov. 30 Income summarySales returns and allowancesCost of goods soldDelivery expenseDepr. exp.-Del. equip.Repair expenseSalaries expenseAdvertising expenseUtilities expenseRent expenseStore supplies expenseDepr. exp.-Store equip.Interest expenseRetained earningsSales Utilities expenseSalaries expenseDepr. exp.-Del. equip.Advertising expenseIncome summaryRepair expenseStore supplies expenseSales returns and allowancesSalesDelivery expenseRent expenseRetained earningsDepr. exp.-Store equip.Cost of goods soldInterest expense (To close out income summary to retained earnings.) Prepare a post-closing trial balance. (If the answer is zero, please enter 0, do not leave any fields blank.) BELLEMY FASHION CENTER Post-Closing Trial Balance November 30, 2010 Debit Credit Cash $ $ Accounts Receivable Merchandise Inventory Store Supplies Store Equipment Accumulated Depreciation - Store Equipment Delivery Equipment Accumulated Depreciation - Delivery Equipment Notes Payable Accounts Payable Interest Payable Common Stock Retained Earnings $ $