Continuing Problem Part 1 P-F:5-50 Journalizing and posting purchase and sale transactions This problem continues the Canyon Canoe Company situation from Chapter F:4. At the beginning of the new year, Canyon Canoe Company decided to carry and sell T-shirts with its logo printed on them. Canyon Canoe Company uses the perpetual inventory system to account for the inventory. During January 2025, Canyon Canoe Company completed the following merchandising transactions: Jan. 1 2 3 7 8 10 12 14 18 20 21 221 23 25 25 Purchased 10 T-shirts at $4 each and paid cash. Sold 6 T-shirts for $10 each, total cost of $24. Received cash. Purchased 50 T-shirts on account at $5 each. Terms 2/10, n/30. Paid the supplier for the T-shirts purchased on January 3, less discount. Realized 4 T-shirts from the January 1 order were printed wrong and returned them for a cash refund. Sold 40 T-shirts on account for $10 each, total cost of $200. Terms 3/15, n/45. Received payment for the T-shirts sold on account on January 10, less discount. Purchased 100 T-shirts on account at $4 each. Terms 4/15, n/30. Canyon Company called the supplier from the January 14 purchase and told them that some of the T-shirts were the wrong color. The supplier offered a $50 purchase allowance. Paid the supplier for the T-shirts purchased on January 14, less the allowance and discount. Sold 60 T-shirts on account for $10 each, total cost of $220. Terms 2/20, n/30. Received a payment on account for the T-shirts sold on January 21, less discount. Purchased 320 T-shirts on account at $5 each. Terms 2/10, n/30, FOB shipping point. Activa Crent 27 222 29 30 31 Paid freight associated with the January 25 purchase, $48. Paid for the January 25 purchase, less discount. Sold 275 T-shirts on account for $10 each, total cost of $1,300. Terms 2/10, n/30. Received payment for the T-shirts sold on January 30, less discount. Requirements 1. Open the following T-accounts in the ledger, using the post-closing balances from Chapter F:4: Cash; Accounts Receivable; Merchandise Inventory; Estimated Returns Inventory; Office Supplies; Prepaid Rent; Land; Building; Accumulated Depreciation-Building; Canoes; Accumulated Depreciation Canoes; Accounts Payable; Utilities Payable; Telephone Payable; Wages Payable; Refunds Payable; Interest Payable; Unearned Revenue; Notes Payable; Wilson, Capital; Income Summary; Sales Revenue; Canoe Rental Revenue; Cost of Goods Sold; Rent Expense; Wages Expense; Utilities Expense; Telephone Expense; Supplies Expense; Depreciation Expense-Building; Depreciation Expense Canoes; Interest Expense. Activa 2. Journalize and post the transactions. Compute each account balance and denote the balance as Balance. Omit explanations. Go to S Continuing Problem Part 2 P-F:5-51 Making adjusting and closing entries, preparing financial statements, and computing the gross profit percentage This problem continues the Canyon Canoe Company situation and focuses on non-merchandising transactions, adjusting and closing entries, and preparing financial statements. Canyon Canoe Company does not typically prepare adjusting and closing entries each month, but the company is surprised at how popular the shirts are and wishes to know the net income for January and would also like to understand how to prepare the closing entries for a merchandising company. During January 2025, Canyon Canoe Company completed the following non-merchandising transactions: Activ. Jan. 2 Collected $4,500 on account. Paid the utilities and telephone bills from December. 15 15 Paid the wages accrued in December. 18 20 23 Rented canoes and received cash, $1,825. Received bills for utilities ($360) and telephone ($275), which will be paid later. Paid various accounts payable, $1,800. 30 Paid employee, $750. Requirements 1. Journalize and post the January transactions. Omit explanations. Use the ledger from the previous problem for posting. 2. Journalize and post the adjusting entries for the month of January. Omit explanations. Denote each adjustment as Adj. Compute each account balance, and denote the balance as Balance. In addition to the adjusting entries from the data from previous chapters, Canyon Canoe Company provides this data: a. A physical count of the inventory at the end of the month revealed the cost was $470. b. The company estimated sales returns will be $30 with a cost of $15. c. Office supplies used, $55. d. The Unearned Revenue has now been earned. A AG d. The Unearned Revenue has now been earned. e. Interest expense accrued on the notes payable, $50. 3. Prepare the month ended January 31, 2025, single step income statement of Canyon Canoe Company. 4. Journalize and post the closing entries. Omit explanations. Denote each closing amount as Clo. and each balance as Balance. After posting all closing entries, prove the equality of debits and credits in the ledger by preparing a post-closing trial balance. 5. Compute the gross profit percentage for January for Canyon Canoe Company