Required information Problem 5-5A Preparing adjusting entries and income statements; computin and current ratios LO A1, A2, P3, P4 (The following information applies to the questions displayed below.) The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company perpetual inventory system. It categorizes the following accounts as selling expenses: der equipment, sales salaries expense, rent expense-selling space, store supplies expense, categorizes the remaining expenses as general and administrative. NELSON COMPANY Unadjusted Trial Balance January 31 Credit Debit $ 4,900 12,500 5,400 2,100 42,700 $ 18,700 15,000 18,000 2,150 115,450 Cash Merchandise inventory Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable J. Nelson, Capital J. Nelson, Withdrawals Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Sales salaries expense Office salaries expense Insurance expense Rent expense-Selling space Rent expense-Office space Store supplies expense Advertising expense Totals 1,800 2,200 38,000 15,000 15,000 8,000 8,000 9,400 $167, 150 $167,150 Additional Information: a. Store supplies still available at fiscal year-end amount to $2.250. b. Expired insurance, an administrative expense, for the fiscal year is $1,600. c. Depreciation expense on store equipment, a selling expense, is $1,650 for the fiscal year d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows available at fiscal year-end.