PART 10 PARQADISE CREEK CO Prepare a post-closing trial balance.

Merchandise inventory on May 31, $570,000

Insurance expired during the year, $12,000

Store supplies on hand on May 31, $4,000

Depreciation for the current year, $14,000

Accrued salaries on May 31:

Sales salaries, $7,000

Office salaries, $6,600

Total accrued salaries: $13,600

The adjustment for customer returns and allowances is $60,000 for sales and $35,000 for cost of merchandise sold.

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2016 (unless otherwise indicated), are as follows:

110 Cash $ 83,600

112 Accounts Receivable 233,900

'115 Merchandise Inventory 624,400

116 Estimated Returns Inventory 28,000

117 Prepaid Insurance 16,800

118 Store Supplies 11,400

123 Store Equipment 569,500

124 Accumulated Depreciation-Store Equipment 56,700

210 Accounts Payable 96,600

211 Salaries Payable

212 Customers Refunds Payable 50,000

310 Lynn Tolley, Capital, June 1, 2015 685,300

311 Lynn Tolley, Drawing 135,000

312 Income Summary

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

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 merchandise 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 merchandise 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.

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.

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 merchandise 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.