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The fiscal year-end unadjusted trial balance for Nelson Company is found on the trial balance tab. Rent expense and salaries expense are equally divided between
The fiscal year-end unadjusted trial balance for Nelson Company is found on the trial balance tab. Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system. Descriptions of items that require adjusting entries on January 31, 2017, follow.
- Store supplies still available at fiscal year-end amount to $2,800.
- Expired insurance, an administrative expense, for the fiscal year is $1,820.
- Depreciation expense on store equipment, a selling expense, is $6,000 for the fiscal year.
- To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $11,280 of inventory is still available at fiscal year-end.
- Record the entry to close income statement accounts with credit balances.
- Record the entry to close income statement accounts with debit balances.
- Record the entry to close income summary.
- Record the entry to close the withdrawals account.
Trial Balance | ||
January 31, 2017 | ||
Account Title | Debit | Credit |
---|---|---|
Cash | 18,900 | |
Merchandise inventory | 12,000 | |
Store supplies | 8,400 | |
Prepaid insurance | 2,900 | |
Store equipment | 60,000 | |
Accumulated depreciation - Store equip. | 27,000 | |
Accounts payable | 14,200 | |
J. Nelson, Capital | 42,500 | |
J. Nelson, Withdrawals | 6,400 | |
Sales | 133,000 | |
Sales discounts | 4,000 | |
Sales returns and allowances | 4,200 | |
Cost of goods sold | 40,000 | |
Salaries expense | 35,000 | |
Rent expense | 14,000 | |
Advertising expense | 10,900 | |
Total | 216,700 | 216,700 |
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