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Valley Company$$s adjusted account balances from its general ledger on August $31,$ its fiscal year$-$end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expense$$selling space, store supplies expense, and advertising expense. It categorizes the remaining expenses as general and administrative.

Adjusted Account Balances Debit Credit

Merchandise inventory $($ending$)$ $ $44,000$

Other $($non$-$inventory$)$ assets $176,000$

Total liabilities $ $50,820$

Common stock $84,308$

Retained earnings $59,229$

Dividends $8,000$

Sales $300,960$

Sales discounts $4,605$

Sales returns and allowances $19,863$

Cost of goods sold $115,842$

Sales salaries expense $41,232$

Rent expense$$Selling space $14,145$

Store supplies expense $3,612$

Advertising expense $25,582$

Office salaries expense $37,620$

Rent expense$$Office space $3,612$

Office supplies expense $1,204$

Totals $ $495,317$ $ $495,317$

Beginning merchandise inventory was $$35,508.$ Supplementary records of merchandising activities for the year ended August $31$ reveal the following itemized costs.

Invoice cost of merchandise purchases $ $129,360$

Purchases discounts received $2,717$

Purchases returns and allowances $6,209$

Costs of transportation$-$in $3,900$

Problem $4-4$A $($Algo$)$ Preparing closing entries and interpreting information about discounts and returns LO C$1,$ P$3$

Required:

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