The N-Mart Department Store is located near the Village shopping mall. At the end of the company's fiscal year on December 31, 1998, the following accounts appeared in two of its trial balances.

Analysis reveals the following additional data:
1. Insurance expense and utilities expense are \(60 \%\) selling and \(40 \%\) administrative.
2. \(\$ 20,000\) of the mortgage payable is due for payment next year.
3. Depreciation on the building and property tax expense are administrative expenses; depreciation on the equipment is a selling expense.
\section*{Instructions}

(a) Prepare a multiple-step income statement, a retained earnings statement, and a classified balance sheet.

(b) Journalize the adjusting entries that were made.

(c) Journalize the closing entries that are necessary.

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Unadjusted Accounts Payable Accounts Receivable $ 89,300 Trial Balances Adjusted $ 89,300 50,300 50,300 Accumulated Accumulated Depreciation-Building Depreciation-Equipment 42,100 52,500 29,600 42,900 Building 190,000 190,000 Cash 23,000 23,000