Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Hammer Shop, owned by Joe Smith, sells skateboards in the summer and snowboards in the winter. The shop has an August 31 fiscal year

image text in transcribed
image text in transcribed
The Hammer Shop, owned by Joe Smith, sells skateboards in the summer and snowboards in the winter. The shop has an August 31 fiscal year end and uses a perpetual inventory system and the earnings approach. On August 1, 2024, the company had the following balances in its general ledger: During August, the last month of the fiscal year, the company had the following transactions: Adjustment and additional data: 1. A count of supplies on August 31 shows $755 on hand. 2. The equipment has an estimated eight-year useful life. Remember that adjusting entries are done annually, not monthly. 3. Of the notes payable, $6,000 must be paid on September 1 each year. 4. An analysis of the Unearned Revenue account shows that $3,750 has been earned by August 31 . A corresponding entry of $2,325 for Cost of Goods Sold will also need to be recorded for these sales. 5. Interest accrued on the note payable to August 31 was $175. 6. A count of the merchandise inventory on August 31 shows $76,560 of inventory on hand. Instructions . Create a general ledger account for each of the above accounts and enter the August 1 balances. b. Record and post the August transactions. Update the balances in the general ledger accounts. c. Prepare a trial balance at August 31, 2024. d. Record and post the adjustments required at August 31, 2024 , and update the account balances as required. c. Prepare an adjusted trial balance at August 31, 2024. i. Prepare a multiple-step income statement, statement of owner's equity, and classified balance sheet. The owner made no capital contributions in the year. g. Record and post closing entries. . Prepare a post-closing trial balance at August 31, 2024. Complete your assignment in the excel spreadshect

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Word Search Puzzle Book For Auditing Clerk

Authors: Lx Antu

1st Edition

B09KN7YDD6, 979-8757688466

More Books

Students also viewed these Accounting questions