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when you reach the income statement part, can you please explain what they mean by rent expenses and salary expensis are equally devided between selling
when you reach the income statement part, can you please explain what they mean by rent expenses and salary expensis are equally devided between selling activeties and general and adminstrative activities? should I just devide the total and split it between selling activity and general and administrative activity! thanks!
The following unadjusted trial balance is prepared at fiscal year-end for Morton Company MORTON COMPANY Unadjusted Trial Balance January 31, 2018 Credit $ Debit 29,000 13,500 5,300 2,200 42,800 17,700 14,000 18,000 2,150 138,650 Cash Merchandise inventory Store supplies Prepaid insurance Store equipment Accumulated depreciation Store equipment Accounts payable J. Morton, Capital J. Morton, Withdrawals Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Salaries expense Insurance expense Rent expense Store supplies expense Advertising expense Totals 1,850 2,150 38,000 28,600 13,000 9,800 188,350 $ $ 188,350 Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Morton Company uses a perpetual inventory system. Additional Information: a. Store supplies still available at fiscal year-end amount to $1,500. b. Expired (used) insurance for the fiscal year is $1,750. Insurance expense is an administrative expense. C. Depreciation expense on store equipment is $1,675 for the fiscal year. Depreciation expense is a selling expense. d. A physical count of ending merchandise inventory is taken. The ending count shows $10.700 of inventory is still available at fiscal year-end. REQUIRED: 1. Prepare the adjusting journal entries required. 2. Prepare the multiple-step income statement Step by Step Solution
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