P5-2B Norwich Hardware Store, Ltd. completed the following merchandising trans- actions in the month of May. At the beginning of May, the ledger of Norwich showed Cash of 5,000 and Share Capital-Ordinary of 5,000. May 1 Purchased merchandise on account from Nute's Wholesale Supply 4,200, terms 2/10, n/30. 2 Sold merchandise on account 2,300, terms 1/10, 1/30. The cost of the merchandise sold was 1,300. 5 Received credit from Nute's Wholesale Supply for merchandise returned 500. 9 Received collections in full, less discounts, from customers billed on sales of 2,300 on May 2. 10 Paid Nute's Wholesale Supply in full, less discount. 11 Purchased supplies for cash 400. 12 Purchased merchandise for cash 1,400. May 15 Received refund for poor quality merchandise from supplier on cash purchase 150. 17 Purchased merchandise from Sherrick Distributors 1,300, FOB shipping point, terms 2/10, n/30. 19 Paid freight on May 17 purchase 130. 24 Sold merchandise for cash 3,200. The merchandise sold had a cost of 2,000. 25 Purchased merchandise from Herbert, Inc. 620, FOB destination, terms 2/10, n/30. 27 Paid Sherrick Distributors in full, less discount. 29 Made refunds to cash customers for defective merchandise 90. The returned merchandise had a fair value of 40. 31 Sold merchandise on account 1,000 terms n/30. The cost of the merchandise sold was 560. Norwich Hardware's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 311 Share Capital-Ordinary, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold. Instructions (a) Journalize the transactions using a perpetual inventory system. (b) Enter the beginning cash and share capital-ordinary balances and post the transac- tions. (Use Jl for the journal reference.) (c) Prepare an income statement through gross profit for the month of May 2017