The Tennis Shop, owned by Alex Mikhale, sells tennis equipment. The shop has as August 31^st fiscal year end and uses a perpetual inventory system. On August 1^st, 2019, the company had the following balances in its general ledger:

Cash17,840A.Mikhael, Capital54,650

Accounts Receivable2,975A.Mikhael, Drawings41,000

Inventory112,700Sales762,300

Supplies2,660Sales Ret/Allow11,420

Prepaid Insurance4,140Sales Discounts3,805

Equipment53,800Cost of Goods Sold517,680

Accumulated Amortization Salaries Expense92,900

- Equiment13,450

Accounts Payable18,625Rent Expense17,050

Unearned Revenue4,820Advertising Expense9,625

Notes Payable36,000Interest Expense2,250

During August, the last month of the fiscal year, the company had the following transactions:

Aug.1Paid $1,550 for August's rent

2Paid $4,500 owing on account

4Sold merchandise costing $8,500 for $12,250 cash

5Purchased merchandise on account from Orange Line Co., FOB shipping point, for $24,500

5The correct company paid freight charges of $500 from Aug 5^th transaction

8Purchased supplies on account for $345

9Refunded a customer $425 cash for returned merchandise. The merchandise had cost $290 and was returned to inventory.

10Sold merchandise on account to Spider Company for $16,750, terms 2/10, n/30, FOB shipping point. The merchandise had a cost of $11,340

11Paid Orange Line Co. For half of the merchandise purchased on August 5^th

12Spider Company returned $750 of the merchandise it pruchased. The merchandise had a cost of $510 and was returned to inventory.

15Paid salaries, $4,200

17A. Mikhael took out $3,800 cash for personal use

19Spider Company paid the amount owing

21Purchased $9,900 of merchandise from Rainbow Option Co. On account, terms 2/10, n/30, FOB destination

23Returned $800 of the merchandise to Rainbow Option Co

24Received $525 cash in advance from customers for merchandise to be delivered in September

26Purchased merchandise for $4,500 cash

29Paid $1,200 for advertising

30Paid Rainbow Option Co, the amount owing

31Collected $775 from past accounts receivable

Instructions:

(a) Prepare a Income Statement, Statement of Owner's Equity, and Classified Balance Sheet (Note: account balances in the T-accounts will change after step (e))

(b) Record and post closing entries

(c) Prepare a post-closing trial balance on August 31^st