The Deluxe Store is located in midtown Madison. During the past several years, net income has been declining because of suburban shopping centers. At the end of the company's fiscal year on November 30, 2020, the following accounts appeared in two of its trial balances.

Instructions

a. Prepare a multiple-step income statement, a retained earnings statement, and a classified balance sheet. Notes payable are due in 2023.

b. Journalize the adjusting entries that were made.

c. Journalize the closing entries that are necessary.

Transcribed Image Text:

Unadjusted Adjusted $ 25,200 $ 25,200 Accounts Payable Accounts Receivable 30,500 30,500 Accumulated Depr.-Equip. 34,000 45,000 Cash 26,000 26,000 Common Stock 40,000 40,000 Cost of Goods Sold 507,000 507,000 Dividends 10,000 10,000 Freight-Out 6,500 6,500 146,000 146,000| Equipment Depreciation Expense 11,000 Insurance Expense 7,000 Interest Expense 6,400 6,400 Interest Revenue 8,000 8,000 Inventory $ 29,000 $ 29,000| Notes Payable 37,000 37,000 Prepaid Insurance 10,500 3,500 Property Tax Expense 2,500 Property Taxes Payable 2,500 Rent Expense 15,000 15,000 Retained Earnings 61,700 61,700 Salaries and Wages Expense 96,000 96,000 Sales Commissions Expense 6,500 11,000 Sales Commissions Payable 4,500 Sales Returns and Allowances 8,000 8,000 Sales Revenue 700,000 700,000 Utilities Expense 8,500 8,500