Principles (GAAP). Business activity is recorded on an accrual basis. The company employs the perpetual inventory system in accounting for its merchandise inventory. Sales revenue is recorded net of sales discounts. Purchases of inventory are also recorded net of purchases discounts. The company operates using a January through December fiscal year. The balances of the accounts in the general ledger as of November 30 of the current fiscal year are as follows 110 Cash 45,300 111 Accounts Receivable 177,100 112 Inventory 251,400 113 Estimated Returns Inventory 8,100 114 Supplies 15,300 115 Prepaid Insurance 30,000 120 Land 170,000 121 Equipment 897,100 122 Accumulated Depreciation-- Equip. 229,600 210 Accounts Payable 37,810 211 Customer Refunds Payable 25,200 212 Salaries Payable 0 213 Interest Payable 0 214 Unearned Rent 33,200 220 Notes payable (final payment due in 4 years) 50.000 214 220 Unearned Rent Notes payable (final payment due in 4 years) 310 Common Stock, $1 par 311 Retained Earnings 312 Dividends 313 Income Summary 410 Sales 33,200 50,000 180,000 480,200 75,000 0 4,350,400 510 Cost of Goods Sold 2,234,800 520 Sales Salaries Expense 659,700 521 Advertising expense 220,000 522 Delivery Expense 45,210 523 Rent expense 125,000 524 Miscellaneous selling expense 42,800 510 Cost of Goods Sold 2,234,800 520 Sales Salaries Expense 659,700 521 Advertising expense 220,000 522 Delivery Expense 45,210 523 Rent expense 125,000 524 Miscellaneous selling expense 42,800 530 Office Salaries Expense 357,000 531 Depreciation Expense- Equip. 29,600 532 Insurance Expense 0 533 Supplies Expense 0 610 Rent revenue 710 Interest Expense 0 3,000 There are 180,000 shares of common stock outstanding for the entire year. During C There are 180,000 shares of common stock outstanding for the entire year. During December, the last month of the fiscal year, the following transactions were completed: Dec 1 Purchased $24,500 of merchandise on account, FOB shipping point, terms 1/10,n/30. 3 Paid transportation costs of $520 on the December 1 purchase. 5 Returned $3,800 of the merchandise purchased on December 1. 10 Paid for the purchase of December 1 less the return and the discount. 11 Sold merchandise on account, $12,700, FOB destination, 2/15,n/30. The cost of the merchandise sold was $7,800. 12 Paid transportation charges of $300 for the merchandise sold on December 11. 15 Received payment from customers on account, $9,250. Amount received is net of discount. 22 Received payment on account for the sale of December 11, less the discount. 23 Purchased supplies on account, n/30 $700. 26 Paid amounts owed to creditors on account, $9,040. Amount paid was net of discount. 27 Paid sales salaries, $2,300, and office salaries, $1,400. 28 Sold merchandise for cash, $16,500. The cost of the merchandise sold was $11,200. 29 Paid customer a cash refund of $2,210 for returned merchandise from the sale of Dec. 11. The cost of the returned merchandise was $1,212. 30 Paid rent for store equipment for December, $1,000. 31 Paid cash for a web page advertisement, $680 INSTRUCTIONS: ROUND ALL AMOUNTS TO THE NEAREST DOLLAR, AS NECESSARY! 1. Enter the balances of each of the accounts as of November 30 in the appropriate balance column of a T account (use account names and numbers) or a four-column account. [You are creating the General Ledger.] aporal Journal) the transactions for December 2. Journalize (using the General Journal) the transactions for December. 3. Post the December journal entries to the General Ledger, computing the year-end balances after all posting is completed. 4. Prepare an Unadjusted Tria Balance as of December 31. 5. Analyze the following adjustment data assembled at the end of December. Use the adjustment data to journalize, then post, the necessary adjusting entries. a. Merchandise inventory on hand at December 31, per physical.count, $247,650. b. Insurance coverage expired during the year, $18,800. c. Supplies on hand at December 31, $3,400. d. Additional depreciation to be recorded on the equipment for the year, $14.130. e. Accrued sales salaries $1,800 and accrued office salaries $890 on December 31. f. Accrued interest on the note payable as of December 31, $330. g. Unearned Rent at December 31 is $8,300. h. Company estimates that customers will request an additional $12,830 of refunds related to current year sales and the related merchandise to be costing $6,500 will be returned. 6. Prepare an Adjusted Trial Balance as of December 31. 7. Prepare, in good form, a multiple-step Income Statement, a Retained Earings Statement, and a classified Balance Sheet at the end of the December 31 fiscal year. Retained earnings as of 11/30 equaled retained earnings as or beginning of the riscar year (171) 2 b. Insurance coverage expired during the year, $18,800. c. Supplies on hand at December 31, $3,400. d. Additional depreciation to be recorded on the equipment for the year, $14,130. e. Accrued sales salaries $1,800 and accrued office salaries $890 on December 31. f. Accrued interest on the note payable as of December 31, $330. g. Unearned Rent at December 31 is $8,300. h. Company estimates that customers will request an additional $12,830 of refunds related to current year sales and the related merchandise to be costing $6,500 will be returned. 6. Prepare an Adjusted Trial Balance as of December 31. 7. Prepare, in good form, a multiple-step Income Statement, a Retained Earnings Statement, and a classified Balance Sheet at the end of the December 31 fiscal year. Retained earnings as of 11/30 equaled retained earnings as of beginning of the fiscal year (1/1). 8. Journalize and post the necessary closing entries. 9. Prepare a Post-Closing Trial Balance as of December 31. 2 accounting information system is based upon the principles and rules of U.S. Generally Accepted Accounting Principles (GAAP). Business activity is recorded on an accrual basis. The company employs the perpetual inventory system in accounting for its merchandise inventory. Sales revenue is recorded net of sales discounts. Purchases of inventory are also recorded net of purchases discounts. The company operates using a January through December fiscal year. The balances of the accounts in the general ledger as of November 30 of the current fiscal year are as follows: 110 Cash 111 Accounts Receivable 112 Inventory 45,300 177,100 251,400 113 Estimated Returns Inventory 8,100 114 Supplies 15,300 115 Prepaid Insurance 30,000 120 Land 170,000 121 Equipment 897,100 122 Accumulated Depreciation-- Equip. 229,600 210 Accounts Payable 37,810 211 Customer Refunds Payable 25,200 212 Salaries Payable 0 213 Interest Payable 0 214 Unearned Rent 33,200 220 310 Notes payable (final payment due in 4 years) Common Stock, $1 par 50,000 180,000 311 Retained Earnings 480,200 312 Dividends 313 Income Summary 75,000 0 410 Sales 4,350,400 510 Cost of Goods Sold 2,234,800 520 Sales Salaries Expense 659,700 521 Advertising expense 220,000 522 Delivery Expense 45,210 523 Rent expense 125,000 524 Miscellaneous selling expense 42,800 530 Office Salaries Expense 357,000 531 Depreciation Expense- Equip. 29,600 532 Insurance Expense 0 533 Supplies Expense 0 610 Rent revenue 710 Interest Expense 0 3,000 INSTRUCTIONS: ROUND ALL AMOUNTS TO THE NEAREST DOLLAR, AS NECESSARY! 1. Enter the balances of each of the accounts as of November 30 in the appropriate balance column of a T account (use account names and numbers) or a four-column account. [You are creating the General Ledger.] 2. Journalize (using the General Journal) the transactions for December. 3. Post the December journal entries to the General Ledger, computing the year-end balances after all posting is completed. 4. Prepare an Unadjusted Trial Balance as of December 31. 5. Analyze the following adjustment data assembled at the end of December. Use the adjustment data to journalize, then post, the necessary adjusting entries. a. Merchandise inventory on hand at December 31, per physical count, $247,650. b. Insurance coverage expired during the year, $18,800. c. Supplies on hand at December 31, $3,400. d. Additional depreciation to be recorded on the equipment for the year, $14,130. e. Accrued sales salaries $1,800 and accrued office salaries $890 on December 31. f. Accrued interest on the note payable as of December 31, $330. g. Unearned Rent at December 31 is $8,300. h. Company estimates that customers will request an additional $12,830 of refunds related to current year sales and the related merchandise to be costing $6,500 will be returned. 6. Prepare an Adjusted Trial Balance as of December 31. 7. Prepare, in good form, a multiple-step Income Statement, a Retained Earnings Statement, and a classified Balance Sheet at the end of the December 31 fiscal year. Retained earnings as of 11/30 equaled retained earnings as of beginning of the fiscal year (1/1). 8. Journalize and post the necessary closing entries. 9. Prepare a Post-Closing Trial Balance as of December 31