The adjusted trial balance of Harrison Trading Company at September 30, 2017 is given below. Harrison Trading Company uses the perpetual inventory system.

Required
1. Journalize Harrison Trading Company's closing entries.
2. Compute the gross margin percentage and the rate of inventory turnover for 2017. Inventory on hand at September 30, 2016, was $40,000. For 2016, Harrison Trading Company's gross margin percentage was 34.8 percent and the inventory turnover rate was 3.9 times. Does the two-year trend in these ratios suggest improvement or deterioration in profitability?

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HARRISON TRADING COMPANY Adjusted Trial Balance September 30, 2017 Debit Credit Cash Accounts receivable Inventory Supplies Building Accumulated amortization-building Land Accounts payable Salary payable Unearned sales revenue Note payable, long-term B. Harrison, capital B. Harrison, withdrawals Sales revenue Sales returns Cost of goods sold Selling expenses General expenses Interest expense Total $14,000 9,000 42,000 3,000 280,000 $196,000 70,000 11,000 2,400 1,600 80,000 70,900 55,000 355,000 14,000 167,000 36,500 22,400 4,000 716,900 $716,900