On December 31, 20y6, the balances of the accounts appearing in the ledger of Wyman Company are as follows:

Instructions

1. Does Wyman Company use a periodic or perpetual inventory system? Explain. 

2. Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 20y6. The merchandise inventory as of December 31, 20y6, was $335,000.

3. Prepare the closing entries for Wyman Company as of December 31, 20y6.

4. What would the net income have been if the perpetual inventory system had been used?

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Cash $ 13,500 Purchases $2,650,000 Accounts Receivable 72,000 Purchases Returns and Allowances 93,000 Merchandise Inventory, Purchases Discounts 37,000 January 1, 20Y6 Office Supplies 257,000 Freight In Sales Salaries Expense Advertising Expense Delivery Expense Depreciation Expense- Store Equipment Miscellaneous Selling Expense Office Salaries Expense Rent Expense Insurance Expense Office Supplies Expense Depreciation Expense- Office Equipment Miscellaneous Administrative Expense Rent Revenue 48,000 300,000 3,000 Prepaid Insurance Land 4,500 45,000 9,000 150,000 Store Equipment 270,000 Accumulated Depreciation- Store Equipment Office Equipment 6,000 55,900 12,000 78,500 175,000 28,000 Accumulated Depreciation- Office Equipment Accounts Payable Customer Refunds Payable Salaries Payable 16,000 3,000 27,800 50,000 3,000 2,000 Unearned Rent Notes Payable Shirley Wyman, Capital Shirley Wyman, Drawing Sales 1,500 8,300 50,000 3,500 530,500 7,000 Interest Expense 2,000 25,000 3,280,000