Problem 4-4A Preparing closing entries and interpreting information about discounts and returns LO C2, P3

Valley Companys adjusted trial balance on August 31, 2018, its fiscal year-end, follows.

		Debit			Credit
Merchandise inventory		$	39,700
Other (noninventory) assets			59,880
Total liabilities					$	24,400
Common stock						16,240
Retained earnings						20,300
Dividends			8,300
Sales						226,800
Sales discounts			2,260
Sales returns and allowances			12,000
Cost of goods sold			76,700
Sales salaries expense			32,100
Rent expenseSelling space			8,300
Store supplies expense			1,800
Advertising expense			14,000
Office salaries expense			28,800
Rent expenseOffice space			3,500
Office supplies expense			400
Totals		$	287,740		$	287,740

On August 31, 2017, merchandise inventory was $25,800. Supplementary records of merchandising activities for the year ended August 31, 2018, reveal the following itemized costs.

Invoice cost of merchandise purchases	$	92,900
Purchases discounts received		2,700
Purchases returns and allowances		4,400
Costs of transportation-in		4,800

Required:

1. Prepare closing entries as of August 31, 2018 (the perpetual inventory system is used).