The accounts and their balances in the ledger of Rack Saver Co. on December 31, 2010, are as follows:

The data needed for year-end adjustments on December 31 are as follows:

Instructions
1. Prepare an end-of-period spreadsheet (work sheet) for the fiscal year ended
December 31, 2010. List all accounts in the order given.
2. Prepare a multiple-step income statement.
3. Prepare a statement of owner's equity.
4. Prepare a report form of balance sheet, assuming that the current portion of the note payable is $36,000.
5. Journalize the adjusting entries.
6. Journalize the closingentries.

Transcribed Image Text:

$ 12,000 Sales Cash $800,000 Accounts Receivable 72,500 Sales Returns and Allowances 11,900 Merchandise Inventory Prepaid Insurance Store Supplies Office Supplies Store Equipment Accumulated Depreciation- 170,000 Sales Discounts 7,100 9,700 4,200 Cost of Merchandise Sold 500,000 96,400 Sales Salaries Expense Advertising Expense Depreciation Expense- Store Equipment Store Supplies Expense Miscellaneous Selling Expense Office Salaries Expense Rent Expense Insurance Expense Depreciation Expense Office Equipment Office Supplies Expense Miscellaneous Administrative 2,100 25,000 360,000 60,300 70,000 Store Equipment Office Equipment Accumulated Depreciation- Office Equipment Accounts Payable 1,600 64,000 17,200 46,700 16,000 Salaries Payable Unearned Rent 3,000 Note Payable (final payment due 2018) Evan Hoffman, Capital Evan Hoffman, Drawing Income Summary 180,000 352,750 Expense 1,650 25,000 Rent Revenue Interest Expense 10,800