Patrick Mahomes, a corporation, created a sports equipment company on July 1, 2025. Patrick Mahomes Sports Equipment is a wholesaler that specializes in sports equipment sold to colleges, universities, sporting goods stores and individual customers. This merchandising company uses the perpetual inventory system, the gross method and adjusts its books monthly. The transactions for the month of July are as follow:

7/1 Investors contributed $132,000 cash, a $50,000 computer system and $10,000 of office equipment to Patrick Mahomes Sports Equipment corporation.

7/1 Patrick Mahomes Sports Equipment paid $3,200 cash for rent for the retail store space for the month of July.

7/1 Patrick Mahomes Sports Equipment purchased $82,000 of inventory from Jerry Rice Unlimited. The credit terms are 2/10, n/30.

7/2 Patrick Mahomes Sports Equipment purchased office supplies for $5,450 cash.

7/2 Patrick Mahomes Sports Equipment purchased a 12-month insurance policy for $6,000 cash.

7/3 Patrick Mahomes Sports Equipment purchased $19,000 of inventory from Donavon McNabb. The credit terms are 2/15, n/30.

7/5 Patrick Mahomes Sports Equipment sold merchandise to Aaron Rodgers on credit for $52,850, terms 2/15, net 30. The merchandise sold had a cost of $31,250.

7/7 Patrick Mahomes Sports Equipment purchased inventory from Rob Gronkowski for $17,850 cash.

7/10 Patrick Mahomes Sports Equipment sold merchandise to Davante Adams Company for $75,200 cash. The merchandise sold had a cost of $48,400.

7/10 Paid the amount due on the 7/1 purchase from Jerry Rice Unlimited.

7/15 Aaron Rodgers Company paid for the merchandise sold on 7/5.

7/18 Patrick Mahomes Sports Equipment paid the amount due on the 7/3 purchase from Donovan McNabb Company.

Required:

Using the Excel Template, complete each of the following steps outlined below:

1. Using the chart of accounts provided for you, prepare journal entries for the transactions for the month of July.

2. Post the July transactions using the T-accounts provided for you.

3. Create an unadjusted trial balance. Check Figure: 320,050 Total Debits

4. Once you have verified that your unadjusted trial balance is correct, prepare the following adjusting entries.

a. A physical count of the Office Supplies account showed that there was $2,000 worth of office supplies on hand. The balance of the Office Supplies account on the unadjusted trial balance is $5,450.

b. One months insurance expired on the 12-month insurance policy purchased on July 1^st for $6,000.

c. Depreciation expense on the computer system and the office equipment totaled $750 for the month of July.

d. Patrick Mahomes Sports Equipment pays their 3 part-time employees on a monthly basis. The employees will receive their paychecks totaling $3,000 on August 2, 2025.

5. Post the adjusting entries to the T-accounts provided.

6. Create an adjusted trial balance. Check Figure: 323,800 Total Debits

7. Once you have verified that your adjusted trial balance is correct, prepare a multiple-step income statement, a statement of retained earnings, and a balance sheet. Check Figure: Net income 36,443

8. Prepare closing entries.

9. Post the closing entries to the T-accounts provided.

10. Prepare a post-closing trial balance.