Problem 5-4A Preparing closing entries and interpreting information about discounts and returns LO C2, P3 Valley Companys adjusted trial balance on August 31, its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expenseselling space, store supplies expense, advertising expense. It categorizes the remaining expenses as general and administrative. Debit Credit Merchandise inventory (ending) $ 39,700 Other (noninventory) assets 46,790 Total liabilities $ 25,700 K. Valley, Capital 20,000 K. Valley, Withdrawals 8,300 Sales 226,800 Sales discounts 2,260 Sales returns and allowances 13,500 Cost of goods sold 76,000 Sales salaries expense 31,200 Rent expenseSelling space 8,500 Store supplies expense 1,600 Advertising expense 12,000 Office salaries expense 28,500 Rent expenseOffice space 3,800 Office supplies expense 350 Totals $ 272,500 $ 272,500 Beginning merchandise inventory was $25,000. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs. Invoice cost of merchandise purchases $ 92,800 Purchases discounts received 2,200 Purchases returns and allowances 4,800 Costs of transportation-in 4,900 Required: Prepare closing entries as of August 31 (the perpetual inventory system is used).