Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 20Y7 (unless otherwise indicated), are as follows:

110	Cash	$83,600
112	Accounts Receivable	233,900
115	Merchandise Inventory	652,400
117	Prepaid Insurance	16,800
118	Store Supplies	11,400
123	Store Equipment	569,500
124	Accumulated DepreciationStore Equipment	56,700
210	Accounts Payable	96,600
211	Customer Refunds Payable	50,000
212	Salaries Payable
310	Lynn Tolley, Capital, June 1, 20Y6	685,300
311	Lynn Tolley, Drawing	135,000
410	Sales	5,069,000
510	Cost of Merchandise Sold	2,823,000
520	Sales Salaries Expense	664,800
521	Advertising Expense	281,000
522	Depreciation Expense
523	Store Supplies Expense
529	Miscellaneous Selling Expense	12,600
530	Office Salaries Expense	382,100
531	Rent Expense	83,700
532	Insurance Expense
539	Miscellaneous Administrative Expense	7,800

Part 1: Journalize the transactions for May, the last month of the fiscal year, below.

Part 2: Using the attached spreadsheet as your general ledger, post the journal entries you created in Part 1 to the general ledger, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers. Please be sure to save the spreadsheet general ledger to use for the remaining parts of this comprehensive problem.

If an amount box does not require an entry, leave it blank.

May 1: Paid rent for May, $5,000.

May 3: Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000.

May 4: Paid freight on purchase of May 3, $600.

May 6: Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the merchandise sold was $41,000.

May 7: Received $22,300 cash from Halstad Co. on account.

May 10: Sold merchandise for cash, $54,000. The cost of the merchandise sold was $32,000.

May 13: Paid for merchandise purchased on May 3.

May 15: Paid advertising expense for last half of May, $11,000.

May 16: Received cash from sale of May 6.

May 19: Purchased merchandise for cash, $18,700.

May 19: Paid $33,450 to Buttons Co. on account.

May 20: Paid Korman Co. a cash refund of $5,000 for damaged merchandise from sale of May 6. Korman Co. kept the merchandise.

May 20: Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the merchandise sold was $70,000.

May 21: For the convenience of Crescent Co., paid freight on sale of May 20, $2,300.

May 21: Received $42,900 cash from Gee Co. on account.

May 21: Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000.

May 24: Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000.

May 26: Refunded cash on sales made for cash, $800. The defective merchandise was not returned by the customer.

May 28: Paid sales salaries of $56,000 and office salaries of $29,000.

May 29: Purchased store supplies for cash, $2,400.

May 30: Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the merchandise sold was $47,000.

May 30: Received cash from sale of May 20 plus freight paid on May 21.

May 31: Paid for purchase of May 21, less return of May 24.

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 blank.

Palisade Creek Co. Unadjusted Trial Balance May 31, 20Y7
	Debit Balances	Credit Balances
Cash
Accounts Receivable
Merchandise Inventory
Prepaid Insurance
Store Supplies
Store Equipment
Accumulated DepreciationStore Equipment
Accounts Payable
Customer Refunds Payable
Salaries Payable	fill in the blank 19	fill in the blank 20
Lynn Tolley, Capital	fill in the blank 21	fill in the blank 22
Lynn Tolley, Drawing	fill in the blank 23	fill in the blank 24
Sales	fill in the blank 25	fill in the blank 26
Cost of Merchandise Sold	fill in the blank 27	fill in the blank 28
Sales Salaries Expense	fill in the blank 29	fill in the blank 30
Advertising Expense	fill in the blank 31	fill in the blank 32
Depreciation Expense	fill in the blank 33	fill in the blank 34
Store Supplies Expense	fill in the blank 35	fill in the blank 36
Miscellaneous Selling Expense	fill in the blank 37	fill in the blank 38
Office Salaries Expense	fill in the blank 39	fill in the blank 40
Rent Expense	fill in the blank 41	fill in the blank 42
Insurance Expense	fill in the blank 43	fill in the blank 44
Miscellaneous Administrative Expense	fill in the blank 45	fill in the blank 46