Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek as of May 1, 2018 (unless otherwise indicated), are as follows:

110	Cash	$ 83,600	312	Dividends	$ 135,000
112	Accounts Receivable	233,900	313	Income Summary
115	Inventory	624,400	410	Sales	5,069,000
116	Estimated Returns Inventory	28,000	510	Cost of Goods Sold	2,823,000
117	Prepaid Insurance	16,800	520	Sales Salaries Expense	664,800
118	Store Supplies	11,400	521	Advertising Expense	281,000
123	Store Equipment	569,500	522	Depreciation Expense
124	Accumulated DepreciationStore Equipment	56,700	523	Store Supplies Expense
210	Accounts Payable	96,600	529	Miscellaneous Selling Expense	12,600
211	Salaries Payable		530	Office Salaries Expense	382,100
212	Customers Refunds Payable	50,000	531	Rent Expense	83,700
310	Common Stock	100,000	532	Insurance Expense
311	Retained Earnings	585,300	539	Miscellaneous Administrative Expense	7,800

During May, the last month of the fiscal year, the following transactions were completed:

May 1.		Paid rent for May, $5,000.
3.		Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000.
4.		Paid freight on purchase of May 3, $600.
6.		Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the goods sold was $41,000.
7.		Received $22,300 cash from Halstad Co. on account.
10.		Sold merchandise for cash, $54,000. The cost of the goods sold was $32,000.
13.		Paid for merchandise purchased on May 3.
15.		Paid advertising expense for last half of May, $11,000.
16.		Received cash from sale of May 6.
19.		Purchased merchandise for cash, $18,700.
19.		Paid $33,450 to Buttons Co. on account.
20.		Paid Korman Co. a cash refund of $13,230 for returned merchandise from sale of May 6. The invoice amount of the returned merchandise was $13,500 and the cost of the returned merchandise was $8,000.

Record the following transactions on Page 21 of the journal:

May 20.		Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the goods sold was $70,000.
21.		For the convenience of Crescent Co., paid freight on sale of May 20, $2,300.
21.		Received $42,900 cash from Gee Co. on account.
21.		Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000.
24.		Returned of damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000.
26.		Refunded cash on sales made for cash, $7,500. The cost of the merchandise returned was $4,800.
28.		Paid sales salaries of $56,000 and office salaries of $29,000.
29.		Purchased store supplies for cash, $2,400.
30.		Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the goods sold was $47,000.
30.		Received cash from sale of May 20 plus freight paid on May 21.
31.		Paid for purchase of May 21, less return of May 24.

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. During May, the last month of the fiscal year, transactions were completed. In Part 1 of this problem, the accounting cycle was completed up through the preparation of the adjusted trial balance. Required:

8- If you completed the end-of-period work sheet in Part 1, use the adjusted trial balance figures to prepare an income statement, a retained earnings statement, and a balance sheet. If you didnt complete the end-of-period work sheet in Part 1, use the ledger (the Excel spreadsheet) to prepare an income statement, a retained earnings statement, and a balance sheet. *

9. A. Prepare the closing entries. Record the closing entries on Page 23 of the journal. Refer to the Chart of Accounts for exact wording of account titles.

9. B. Post the closing entries to the ledger of four-column accounts. Add the appropriate posting reference to the journal. Insert the new balance in the retained earnings account.

10. Prepare a post-closing trial balance. Accounts with zero balances can be left blank.

* For guidance in completing the financial statements, be sure to read the instructions above each statement carefully.