The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. NELSON COMPANY Unadjusted Trial
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Question:
The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company.
NELSON COMPANY Unadjusted Trial Balance January 31, 2017 | |||||
Debit | Credit | ||||
Cash | $ | 35,750 | |||
Merchandise inventory | 14,500 | ||||
Store supplies | 5,300 | ||||
Prepaid insurance | 2,800 | ||||
Store equipment | 42,600 | ||||
Accumulated depreciation—Store equipment | $ | 18,250 | |||
Accounts payable | 17,000 | ||||
Common stock | 3,000 | ||||
Retained earnings | 15,000 | ||||
Dividends | 2,000 | ||||
Sales | 147,150 | ||||
Sales discounts | 1,850 | ||||
Sales returns and allowances | 2,100 | ||||
Cost of goods sold | 38,000 | ||||
Depreciation expense—Store equipment | 0 | ||||
Salaries expense | 31,600 | ||||
Insurance expense | 0 | ||||
Rent expense | 14,000 | ||||
Store supplies expense | 0 | ||||
Advertising expense | 9,900 | ||||
Totals | $ | 200,400 | $ | 200,400 | |
Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system.
Additional Information:
- Store supplies still available at fiscal year-end amount to $1,950.
- Expired insurance, an administrative expense, for the fiscal year is $1,750.
- Depreciation expense on store equipment, a selling expense, is $1,700 for the fiscal year.
- To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,900 of inventory is still available at fiscal year-end.
Required:
1. Using the above information prepare adjusting journal entries:
2. Prepare a multiple-step income statement for fiscal year 2017.
3. Prepare a single-step income statement for fiscal year 2017.
Prepare a single-step income statement for fiscal year 2017.
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Related Book For
Fundamental Accounting Principles
ISBN: 978-1259536359
23rd edition
Authors: John Wild, Ken Shaw, Barbara Chiappett
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