Spring Time Inc. is a merchandising business headquartered in the U.S. and selling primarily to wholesalers. The 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 at the point of sale net of customer discounts. Purchases of inventory are recorded at invoice price. Spring Time 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: (Assume all balances are normal balances.)

110	Cash	65,900
111	Accounts Receivable	200,200
112	Allowance for bad debts	2,110
113	Allowance for sales returns	1,900
114	Inventory	256,400
115	Estimated Returns Inventory	0
116	Supplies	12,100
117	Prepaid Insurance	30,000
121	Investments in Available for sale securities: Noncurrent (net)	18,300
131	Land	140,000
132	Equipment	897,100
133	Accumulated Depreciation-- Equip.	289,600
141	Deferred Tax Asset	0
211	Accounts Payable	61,300
212	Salaries Payable	0
213	Refund liability	0
214	Deferred Rent Revenue	33,200
215	Notes Payable (due in 8 months)	50,000
216	Interest Payable	0
217	Income taxes payable	0
311	Common Stock, $1 Par	100,000
312	Additional paid in capital	59,000
313	Retained Earnings	500,800
314	Accumulated Other Comprehensive Income/(Loss)	1,200
315	Income Summary	0
316	Dividends	75,000
411	Sales	4,261,190
412	Sales returns	79,200
511	Cost of Goods Sold	2,122,100
521	Sales Salaries Expense	650,600
522	Advertising Expense	220,000
523	Delivery Expense	36,000
524	Depreciation Expense-- Equip.	29,600
525	Miscellaneous Selling Expense	42,800
526	Office Salaries Expense	357,000
527	Rent Expense	125,000
528	Insurance Expense	0
529	Supplies Expense	0
530	Bad debts expense	0
531	Income taxes expense	0
611	Rent Revenue	0
711	Interest Expense	3,000

There are 150,000 shares of common stock outstanding. During December, the last month of the fiscal year,

the following transactions were completed:

Dec.1 Received $3,000 in advance payment for December, January, and February rent of warehouse space.

3 Purchased $24,500 of merchandise on account, FOB shipping point, terms 2/10,n/30.

4 Paid transportation costs of $475 on the December 3 purchase.

7 Returned $4,000 of the merchandise purchased on December 3.

11 Sold merchandise on account, $12,700, FOB destination, 2/15,n/30. The cost of the merchandise sold was $7,600.

12 Paid transportation charges of $300 for the merchandise sold on December 11.

13 Paid for the purchase of December 3 less the return and the discount.

15 Received payment from customers on account, $8,430. 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 $500.

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.

30 Paid rent on parking lot for December, $1,000,

31 Paid cash for a web page advertisement, $400.

INSTRUCTIONS: ROUND ALL AMOUNTS TO THE NEAREST DOLLAR, AS NECESSARY!

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.