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The following list includes selected permanent accounts and all of the temporary accounts from the December 31 unadjusted trial balance of Emiko Co., a business

The following list includes selected permanent accounts and all of the temporary accounts from the December 31 unadjusted trial balance of Emiko Co., a business owned by Kumi Emiko. Emiko Co. uses a perpetual inventory system.

Debit Credit
Merchandise inventory $ 35,500
Prepaid selling expenses 6,700
Dividends 44,000
Sales $ 573,000
Sales returns and allowances 19,700
Sales discounts 6,100
Cost of goods sold 234,000
Sales salaries expense 59,000
Utilities expense 20,500
Selling expenses 41,500
Administrative expenses 116,000

Additional Information Accrued and unpaid sales salaries amount to $2,300. Prepaid selling expenses of $2,000 have expired. A physical count of year-end merchandise inventory is taken to determine shrinkage and shows $32,000 of goods still available. (a) Use the above account balances along with the additional information, prepare the adjusting entries. (b) Use the above account balances along with the additional information, prepare the closing entries.

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