This corporation sells office products and performs accounting services.

S & B uses the Perpetual Inventory system and had the following balances:

S & B Office Supplies and Services

Trial Balance

January 1, 2020

Title	Debit	Credit
Cash	9,100
Accounts Receivable	2,240
Merchandise Inventory	1,800*
Supplies	860
Equipment	23,000
Accumulated Depreciation		1,000
Accounts Payable		3,300
Unearned Service Revenue		3,800
Salaries and Wages Payable		1,700
Common Stock		20,000
Retained Earnings		7,200
Totals	$37,000	$37,000

*(3,000 units at $0.60)

This is a simulated problem showing some summary transactions that occurred during the month of January.

Jan 2 Paid Januarys rent $400.

3 Purchased 4,000 units of inventory from dds Discount Supply on account at $0.72 each. Terms 2/10, n/30.

4 Sold 4,400 units of inventory for cash at $0.90 per unit. (Sold 3,000 of the 0.60 units and 1,400 of the $0.72 units)

9 Gave a January 4^th customer $180 for 200 units returned costing $144. (These units were returned to inventory)

9 Received $2,000 cash from customers in payment on account. (December salesno discounts)

10 Paid $2,000 on account. (No discounts)

10 Paid $3,550 for salaries due employees, of which 1,850 is for January and $1,700 is for December 2019.

10 Paid dds Discount Supply in full, less discount. (Round to whole dollars)

13 Purchased 5,000 units of inventory on account Office Headquarters at $0.80 each. Terms 2/10, n/30.

15 Sold 4,000 units of inventory to customers on account at $0.95 per unit. Terms 2/10, n/30. (Sold 2,800 of the 0.72 units and 1,200 of the 0.80 units)

23 Received collections in full, less discount, from customers billed for sales on January 15th.

24 Paid Salaries $3,550.

27 Received $4,200 Cash for services performed in January.

28 Purchased supplies on account $1,500.

28 Paid Office Headquarters in full. (No discount)

30 Performed services on account and billed customers $900.

30 Received $675 from customers for services to be performed in the future.

Adjustment Data:

1. Supplies on hand are valued at $1,400.
2. Accrued salaries are $1,775.
3. Depreciation for the month is $250.
4. $575 of services related to the unearned service revenue has not been earned by month end.

Instructions:

1. Enter the January 1, balances in ledger accounts.
2. Post to the ledger accounts. HINT: You will need to add some accounts to the beginning ones available.
3. Prepare a Trial Balance as of January 31^st.
4. Journalize the Adjusting Entries.
5. Post the Adjusting Entries.
6. Prepare an Adjusted Trial Balance at January 31, 2020.
7. Journalize the Closing Entries (Do Not Post)