At the beginning of the current season on November 1, the ledger of Winona Sports showed Cash $3,300, Inventory $4,700, and Common Stock $8,000. The following transactions occurred during November 2014.
Nov. 5 Purchased hockey sticks and pucks on account from Hi-Stick Co. $1,600, terms 2/10, n/60.
7 Paid freight on Hi-Stick Co. purchases $90.
9 Received credit from Hi-Stick Co. for merchandise returned $350.
10 Sold merchandise on account for $1,000, terms n/30.
12 Purchased gloves, socks, and other accessories on account from Twin City Sportswear $945, terms 1/10, n/30.
14 Paid Hi-Stick Co. in full.
17 Received credit from Twin City Sportswear for merchandise returned $45.
20 Made sales on account for $1,330, terms n/30.
21 Paid Twin City Sportswear in full.
27 Granted credit to customers for clothing that did not fit properly $150.
30 Received payments on account for $1,900.
The chart of accounts for Winona Sports includes Cash, Accounts Receivable, Inventory,
Accounts Payable, Common Stock, Sales Revenue, Sales Returns and Allowances, Purchases, Purchase Returns and Allowances, Purchase Discounts, and Freight-In.
(a) Journalize the November transactions using a periodic inventory system.
(b) Using T-accounts enter the beginning balances in the ledger accounts and post the November transactions.
(c) Prepare a trial balance on November 30, 2014.
(d) Prepare an income statement through Gross profit, assuming inventory on hand at November 30 is $5,196.