Problem: Valley Company's adjusted trial balance on August 31, 2015, its fiscal year-end, follows.
|
|
Debit
|
Credit
|
|
Merchandise Inventory
|
$40,300
|
|
|
Other (non inventory) assets
|
46,370
|
|
|
Total liabilities
|
|
$24,400
|
|
Common Stock
|
|
15,280
|
|
Retained earnings
|
|
3,820
|
|
Dividends
|
8,400
|
|
|
Sales
|
|
226,700
|
|
Sales discount
|
2,280
|
|
|
Sales returns and allowances
|
13,000
|
|
|
Cost of goods sold
|
73,900
|
|
|
Sales salaries expense
|
32,100
|
|
|
Rent expense-selling space
|
8,200
|
|
|
Store supplies expense
|
1,700
|
|
|
Advertising expense
|
12,000
|
|
|
Office salaries expense
|
28,100
|
|
|
Rent expense-Office space
|
3,400
|
|
|
Office supplies expense
|
350
|
|
|
Totals
|
$270,200
|
$270,200
|
On August 31, 2014, merchandise inventory was $25,200. Supplementary records of merchandising activities for the year ended August 31, 2015, reveal the following itemized costs.
|
Invoice cost of merchandise purchases
|
$92,100
|
|
Purchase discount received
|
2,900
|
|
Purchase returns and allowances
|
4,800
|
|
Costs of transportation-in
|
4,600
|
Required:
1. Prepare closing entries as of August 31, 2015 (the perpetual inventory system is used).