Waters Hardware Store completed the following merchandising transactions in the month of May. At the beginning of May, Waters ledger showed Cash of $8,000 and Common Stock of $8,000.

May 1		Purchased merchandise on account from Hauke Wholesale Supply for $8,000, terms 1/10, n/30.
2		Sold merchandise on account for $4,400, terms 2/10, n/30. The cost of the merchandise sold was $3,300.
5		Received credit from Hauke Wholesale Supply for merchandise returned $200.
9		Received collections in full, less discounts, from customers billed on May 2.
10		Paid Hauke Wholesale Supply in full, less discount.
11		Purchased supplies for cash $900.
12		Purchased merchandise for cash $3,100.
15		Received $230 refund for return of poor-quality merchandise from supplier on cash purchase.
17		Purchased merchandise from Friedrich Distributors for $2,500, terms 2/10, n/30.
19		Paid freight on May 17 purchase $250.
24		Sold merchandise for cash $5,500. The cost of the merchandise sold was $4,100.
25		Purchased merchandise from Fasteners Inc. for $800, terms 3/10, n/30.
27		Paid Friedrich Distributors in full, less discount.
29		Made refunds to cash customers for returned merchandise $124. The returned merchandise had cost $90.
31		Sold merchandise on account for $1,280, terms n/30. The cost of the merchandise sold was $830.

Question 1 Journalize the transactions using a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Question 2 Post the transactions to T-accounts. Be sure to enter the beginning cash and commo stock balances. (Post entries in the order of journal entries posted in part 1.)

Question 3 Prepare an income statement through gross profit for the month of May 2014.

Question 4 Calculate the profit margin and the gross profit rate. (Assume operating expenses were $1,400.) (Round answers to 0 decimal places, e.g. 15%.)