Practice Set

This problem continues the Shine King Cleaning practice set begun in Chapter $1$ and continued through Chapters $2,3$ and $4.$

P$5-44(23(4)$ Journalizing purchase and sale transactions$-$perpetual inventory; making closing entries, and preparing financial statements $30-40$min

Shine King Cleaning has decided that, in addition to providing cleaning services, it will sell cleaning products. During December, Shine King completed the following transactions:

Dec $2$ Purchased $600$ units of inventory for $$3,600$ from Sparkle, Co$.,$ on terms, $3/10,$ n$/20.$

$5$ Purchased $400$ units of inventory from Borax on terms $\frac{4}{5},\frac{n}{30}.$ The total invoice was for $$3,200,$ which included a $$200$ freight charge.

$7$ Returned $100$ units of inventory to Sparkle from the December $2$ purchase $($cost $$600).$

$9$ Paid Borax.

$11$ Sold $350$ units of goods to Happy Maids for $$4,900$ on terms $\frac{5}{10},\frac{n}{30}.$ Shine King's cost of the goods was $$2,100.$

$12$ Paid Sparkle.

$15$ Received $30$ units with a retail price of $$420$ of goods back from customer Happy Maids. The goods cost Shine King $$180.$

$21$ Received payment from Happy Maids, settling the amount due in full.

$28$ Sold $200$ units of goods to Bridget, Inc., for cash of $$3,000($cost $$1,144).$

$29$ Paid cash for Utilities of $$350.$

$30$ Paid cash for Sales commission expense of $$225.$

$31$ Recorded the following adjusting entries:

Physical count of Inventory on December $31$ showed $330$ units of goods on hand, $$2,541$

Depreciation, $$170$

Accrued salary expense of $$700$

Prepared all other adjustments necessary for December

Requirements

Add any needed accounts to Shine King's existing chart of accounts.

Journalize and post the December transactions. Key all items by date. Compute each account balance, and denote the balance as Bal.

Journalize and post the adjusting entries. Denote each adjusting amount as Adj. After posting all adjusting entries, prove the equality of debits and credits in the ledger.

Prepare the December multi$-$step income statement, statement of owner's equity, and balance sheet for the company.

Journalize the December closing entries for the company.