Required information [The following information applies to the questions displayed below) The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company, Nelson company uses a perpetual inventory system. It categorizes the following accounts as selling expenses: Depreciation Expense-Store Equipment, Sales Salaries Expense, Rent Expense--Selling Space, Store Supplies Expense, and Advertising Expense. It categorizes the remaining expenses as general and administrative NELSON COMPANY Unadjusted Trial Balance January 31 Debit Credit Cash $ 24,850 Merchandise inventory 13,500 Store supplies 5,700 Prepaid insurance 2,200 Store equipment 42,500 Accumulated depreciation Store equipment $ 17,150 Accounts payable 14,000 Common stock 4,000 Retained earnings 35,000 Dividends 2,250 Sales 116,000 Sales discounts 1,850 Sales returns and allowances 2,200 Cost of goods sold 38,000 Depreciation expense-Store equipment Sales salaries expense 14,600 Office salaries expense 14,600 Insurance expense Rent expense-Selling space 7,080 Rent expense-office space 7,000 Store supplies expense 0 Advertising expense 9,900 Totals $186, 150 $186, 150 Additional Information: a. Store supplies still available at fiscal year-end amount to $2,650, b. Expired insurance, an administrative expense, is $1,500 for the fiscal year. 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 $10,600 of inventory is still War b. Expired insurance, an administrative expense, is $1,500 for the fiscal year. 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 $10,600 of inventory is still available at fiscal year-end. Required: 1. Using the above information, prepare adjusting journal entries. 2. Prepare a multiple-step income statement for the year ended January 31. 3. Prepare a single-step income statement for the year ended January 31. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the above information, prepare adjusting journal entries. Debit Credit View transaction list View journal entry worksheet No Transaction General Journal Store supplies expense Store supplies 0 1 a 5,700 2 b. 1,500 Insurance expense Prepaid insurance 1,500 1,650 3 Depreciation expense Store equipment Accumulated depreciation Store equipment 1.650 10,800 4 d. Cost of goods sold Merchandise inventory 10,600 Required information Required 1 Required 2 Required 3 2 Prepare a multiple-step income statement for the year ended January 31, NELSON COMPANY ok 0 0 Income Statement For Year Ended January 31 Sales Add: Sales returns and allowances Less: Sales discounts Net sales Cost of goods sold Gross profit Expenses Selling expenses Rent expense. Selling space Depreciation expense-Store equipment Advertising expense Store supplies expense Sales salaries expense 0 nces 0 Total selling expenses General and administrative expenses Office salaries expense Insurance expenso Rent expense-Office space Total general and administrative expenses 0 TH 0 Gross profit Expenses Selling expenses Rent expense-Selling space Depreciation expense-Store equipment Advertising expense Store supplies expense Sales salaries expense Total selling expenses General and administrative expenses Office salaries expense Insurance expense Rent expense-Office space Total general and administrative expenses Total expenses Net income 0