Problems

P$55$A Buono Adventures, which uses the perpetual inventory system, has the following account balances $($in alphabetical order$)$ on July $31,2023$:

Accounts payable

$ $21,600$

Accounts Receivable

$23,200$

Accumulated Amortization $-$ Equipment

$64,600$

Cash

$8,400$

Cost of Goods Sold

$687,000$

E$.$ Buono, Capital

$402,000$

Les Birman, withdrawals

$92,000$

Equipment

$180,000$

Interest Earned

$4,000$

Inventory

$143,000$

Operating Expenses

$355,000$

Sales Discounts

$10,300$

Sales Returns and Allowances

$32,900$

Sales Revenue

$1,045,200$

Supplies

$14,600$

Unearned Sales Revenue

$9,000$

Note: For simplicity, all operating expenses have been summarized in the account Operating Expenses.

AFD$100$ Accounting Fundamental $1$ Class Exercises $5$

$3$

Additional data at July $31,2023$:

a$.$ A physical count of items showed $$3,000$ of supplies on hand. $($Hint: Use the account Operating Expenses in the adjusting journal entry.$)$

b$.$ An inventory count showed inventory on hand at July $31,2023,$ of $$140,000.$

c$.$ The equipment has an estimated useful life of $8$ years and is expected to have no scrap or residual value at the end of its life. $($Hint: Use the account Operating Expenses in the adjusting journal entry.$)$

d$.$ Unearned sales revenue of $$5,600$ was earned by July $31,2023.$

Required

$1.$ Record all adjustments and closing entries that would be required on July $31,2023.$

$2.$ Prepare the multi$-$step income statement and statement of owner$$s equity for the year ended July $31,2023,$ and the classified balance sheet in report format as at July $31,2023.$

LO$3,$ LO$4$ Adjusting and closing the accounts of a merchandising company, and preparing a merchandiser$$s financial statements under the perpetual inventory system $2.$ Net loss, $$67,500$