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Problem Detail

Chart of Accounts

General Journal $67$

General Jour

ACCOUNT:

Inventory

ACCOUNT NO:

$115$

ACCOUNT:

Estimated Returns Inventory

ACCOUNT NO:

$116$

ACCOUNT:

Prepaid Insurance

$\backslash$table$[[,,,]]$

ACCOUNT NO:

$117$

$\backslash$table$[[,,,,,]]$ Comprehensive Problem $2$ CHART OF ACCOUNTS

Wyoming Restoration Company

General Ledger

Transactions:

May $1,$ Paid rent for May, $$5,000.$

May $2$ Sold merchandise on account to Korman Co$.,$ terms $\frac{n}{15},$ FOB shipping point, $$68,500.$ The cost of

the goods sold was $$41,000.$

May $3$ Purchased merchandise on account from Martin Co$.,$ terms $2/10,$ n$/30,$ FOB shipping point, $$36,000.$

May $4,$ Paid freight on purchase of May $3,$$$600.$

May $10$ Sold merchandise with a list price of $$61,500$ to customers who used VISA and who redeemed

$$7,500$ of point$-$of$-$sale coupons. The cost of the goods sold was $32,000.$

May $13$ Paid for merchandise purchased on May $3.$

May $15$ Paid advertising expense for last half of May, $$11,000.$

May $17,$ Received cash from sale of May $2.$

May $20$ Paid Korman Co$.$ a cash refund of $$13,230$ for returned merchandise from sale of May $2.$ The cost

of the returned merchandise was $$8,000.$

May $21$ Sold merchandise on account to Crescent Co$.,$ terms n$/$eom$,$ FOB shipping point, $$110,000.$ The

cost of the goods sold was $$70,000.$

May $21$ For the convenience of Crescent Co$.,$ paid freight on sale of May $21,$ $$2,300.$

May $21$ Purchased merchandise on account from Osterman Co$.,$ terms $1/10,$ n$/30,$ FOB destination, $$88,000.$

May $24$ Returned damaged merchandise purchased on May $21,$ receiving a credit memo from the seller for $$5,000.$

May $28$ Paid sales salaries of $$56,000$ and office salaries of $$29,000.$

May $29$ Purchased store supplies for cash, $$2,400.$

May $31,$ Received cash from sale of May $21$ plus freight.

May $31,$ Paid for purchase of May $21,$ less return of May $24.$

Required:

Journalize the transactions for May, the last month of the fiscal year.

Post the journal entries to the general ledger.

Enter the unadjusted trial balance on a $10-$column end$-$of$-$period spreadsheet $($work sheet$),$ and complete the spreadsheet using

the following adjustment data

At the end of May, the following adjustment data were assembled:

Item Description

a Physcial inventory count on May $31$

b Insurance expired during the year

c Store supplies on hand on May $31$

d Depreciation for the current year

e Accrued salaries on May $31$ :

Sales salaries

Office salaries

Total

Amount

$$295,000$

$12,000$

$4,000$

$14,000$

$$,7,000$

$6,600$

$13,600$

f The adjustment for customer returns and allowances is $$60,000$ for sales and $$35,000$ for cost of goods sold.

Journalize the adjusting entries. Post the adjusting entries to the general Ledger

Prepare a multiple$-$step income statement.

Prepare a statement of stockholders' equity. Assume that additional common stock of $$10,000$ was issued in January $20Y6.$

Prepare a balance sheet.

Journalize the closing entries. Then post the closing entries to the general ledger $.$

Prepare a post$-$closing trial balance.