PART 2: December 2020. Record the business activity as journal entries, post to Ledgers, prepare the unadjusted trial balance, prepare any adjusting entries for the month, and create the adjusted trial balance. Also, provide a year-end schedule showing the detail of the balances in the Inventory accounts (a template will not be provided).

11/05/2020: Pedal Pushers purchases 55 regular size $12 bike helmets and 25 XL size $15 bike helmets from Outfitters Wholesale Corp., terms 1%/10, Net 30, FOB Destination. The helmets should arrive 11/9/2020. The company will charge customers $25 for the regular size and $30 for the larger size.

12/01/2020: Sell on account to Walker Fitness Gym, terms 1/15, n/30, the following: 36 Regular Bikes, 36 Regular Helmets, 14 XL Bikes, 14 XL Helmets.

12/02/2020: Pay for the helmet purchase that was made November 5^th.

12/03/2020: Purchase on account, terms 2/15, n/30, FOB Destination from Discount Sports Distribution the following items, and received the same day:

• 30 Regular Bikes for $92/each
• 16 XL Bikes for $101/each
• 80 Regular Helmets for $13/each
• 40 XL Helmets for $14/each

12/04/2020: Sold to cash customers 6 XL Bikes, 5 XL Helmets, 3 Regular Bikes, and 4 Regular Helmets.

12/5/2020: Sold to cash customers 22 Regular Bikes, 18 Regular Helmets, and 5 XL Bikes.

12/6/2020: Paid the bill for the purchase of the Point-of-Sale system.

12/8/2020: Received a utilities bill for the bundled phone/internet for the shop. Paid it the same day, $215.

12/10/2020: Sold to cash customers 19 Regular Bikes, 2 Regular Helmets, 10 XL Bikes, 6 XL Helmets.

12/11/2020: Sold on account to Ripleys Raceway Park, terms 1/15, n/30, 20 each of the 4 inventory items.

12/12/2020: Received payment from Walkers Fitness Gym for the entire purchase they made with us on December 1^st.

12/15/2020: Clint and Chelsea decide to take a $5,000 dividend for each of them. They will close the shop for a few weeks to enjoy the year-end holidays and resume business the following year.

Adjusting entries: you should make adjusting entries for any expense items needed. Also, a count of office supplies shows only $65 remaining. To conform with GAAP, the partners decide that an entry for Bad Debts should be made. Using CECL, the partners decide that the chance of non-payment is low, and estimate that 1% of the outstanding A/R will be uncollectible.