Tree top Company is a service based company that rents canoes for use on local lakes and rivers. At the beginning of the new$$ year, Tree Top Company decided to carry and sell$$ T$-$shirts with its logo printed on them. Tree Top Company uses the perpetual inventory system to account for the inventory. During January $2025,$ Tree Top Company completed these merchandising transactions$,$ and posted the merchandising transactions to the ledger accounts.LedgerLedger

Tree Top Company does not typically prepare adjusting and closing entries each$$ month, but the company is surprised at how popular the shirts are and wishes to know the net income for January and would also like to understand how to prepare the closing entries for a merchandising company. During January $2025,$ Tree Top Company completed the following$$ non$-$merchandising transactions:

$1.$ Journalize and post the January transactions. Omit explanations. Use the ledger provided for posting.

$2.$ Journalize and post the adjusting entries for the month of January. Omit explanations. Denote each adjustment as Adj. Compute each account$$ balance, and denote the balance as Bal. In$$ addition, Tree Top Company provides this$$ data:

a$.$ A physical count of the inventory at the end of the month revealed the cost was $ $1791.$

b$.$The company estimated sales returns will be $ $96$ with a cost of $ $48.$

c$.$Office supplies$$ used, $ $70.$

d$.$ The Unearned Revenue has now been earned.

e$.$Interest expense accrued on the notes$$ payable, $ $20.$

f$.$Rent of one month has been used.$($On December $1,$ the company prepaid $ $2$ comma $700$ for three$$ months' rent on the warehouse where the company stores the canoes. On December $31,$ the company recorded one$$ month's worth of rent expense for the month of December in the amount of $ $900.)$

g$.$Monthy depreciation on the building amounts to $ $1300.$

h$.$Monthy depreciation on the canoes amounts to $ $130.$

$3.$Prepare the month ended January $31,2025,$ single step income statement of Tree Top Company.

$4.$Journalize and post the closing entries. Omit explanations. Denote each closing amount as Clo. and each balance as Bal. After posting all closing$$ entries, prove the equality of debits and credits in the ledger by preparing a$$ post$-$closing trial balance.

$5.$ Compute the gross profit percentage for January for Tree Top Company.Jan. $1$ Purchased $13$ T$-$shirts at $$15$ each and paid cash.

Jan. $2$ Sold $5$ T$-$shirts for $$24$ each, total cost of $$75.$ Received cash.

Jan. $3$ Purchased $110$ T$-$shirts on account at $$17$ each. Terms $2/10,$ n$/30.$

Jan. $7$ Paid the supplier for the T$-$shirts purchased on January $3,$ less

discount.

Jan. $8$ Realized $8$ T$-$shirts from the January $1$ order were printed wrong

and returned them for a cash refund.

Jan. $10$ Sold $70$ T$-$shirts on account for $$24$ each, total cost of $$1,190.$

Terms $3/15,$ n$/45.$

Jan. $12$ Received payment for the T$-$shirts sold on account on January $10,$

less discount.

Jan. $14$ Purchased $130$ T$-$shirts on account at $$15$ each. Terms $3/15,$ n$/30.$

Jan. $18$ Tree Top Company called the supplier from the January $14$

purchase and told them that some of the T$-$shirts were the wrong

color. The supplier offered a $$130$ purchase allowance.

Jan. $20$ Paid the supplier for the T$-$shirts purchased on January $14,$ less the

allowance and discount.

Jan. $21$ Sold $90$ T$-$shirts on account for $$24$ each, total cost of $$1,343.$