Use the data for Barkley Company in Problem 4-3B to complete the following requirements.

Required

1. Prepare closing entries as of March 31, 2016 (the perpetual inventory system is used).

Analysis Component

2. In prior years, the company experienced a 5% returns and allowance rate on its sales, which means approximately 5% of its gross sales were eventually returned outright or caused the company to grant allowances to customers. Compute the ratio of sales returns and allowances divided by gross sales. How does this year's ratio compare to the 5% ratio in prior years?

In Problem 4-3B

Barkley Company's adjusted trial balance on March 31, 2016, its fiscal year-end, follows.

On March 31, 2015, merchandise inventory was $37,500. Supplementary records of merchandising activities for the year ended March 31, 2016, reveal the following itemized costs.
Invoice cost of merchandise purchases . . . . . . . . . $138,500
Purchase discounts received . . . . . . . . . . . . . . . . . . . . 2,950
Purchase returns and allowances . . . . . . . . . . . . . . . . 6,700
Costs of transportation-in . . . . . . . . . . . . . . . . . . . . . . 5,750

Debit Credit $ 56,500 ealE_.... Common stock $42,500 10,000 154,425 ,000 332,650 cales-. Sales discounts Sales returns and allowances. Cost of goods sold 5,875 20,000 115,600 16,000 3,850 26,000 40,750 3,800 1,100 Wsas . .. Rent expense-Office space Totals