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Crane Hardware Store completed the following merchandising transactions in the month of May. At the beginning of May, the ledger of Crane showed Cash of $5,000 and Owner's Capital of $5,000. May 1 Purchased merchandise on account from Braun's Wholesale Supply for $4,100, terms 2/10, n/30. 2 Sold merchandise on account $2,400, terms 1/10,n/30. The cost of the merchandise sold was $1,400. 5 Received credit from Braun's Wholesale Supply for merchandise returned $300. 9 Received collections in full, less discounts, from customers billed on May 2. 10 Paid Braun's Wholesale Supply in full, less discount. 11 Purchased supplies for cash $300. 12 Purchased merchandise for cash $1,500. 15 Received $200 refund for return of poor-quality merchandise from supplier on cash purchase. 17 Purchased merchandise on account from Valley Distributors for $1,400, terms 2/10,n/30,FOB shipping point. 19 Paid freight on May 17 purchase $100. 24 Sold merchandise for cash $3,300. The merchandise sold had a cost of $2,200. 25 Purchased merchandise on account from Lumley, Inc. for $750, terms 2/10, n/30. 27 Paid Valley Distributors in full, less discount. 29 Made refunds to cash customers for returned merchandise $60. The returned merchandisecost $40. 31 Sold merchandise on account for $1,500 terms n/30. The cost of the merchandise sold was $500. Crane Hardware's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Crane Hardware's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 301 Owner's Capital, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold. (a) Journalize the transactions using a perpetual inventory system. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (To record credit sale) (To record cost of merchandise sold) (To record cash sale) (To record cost of merchandise sold) (To record cash sale) (To record cost of merchandise sold) (To record merchandise returned) (To record cost of merchandise returned) (To record merchandise returned) (To record cost of merchandise returned) (To record credit sale) (To record cost of merchandise sold) \begin{tabular}{l} eTextbook and Media \\ List of Accounts \\ Save for Later \\ \hline \end{tabular} (b) Enter the beginning cash and capital balances and post the transactions. (Post entries in the order of journal entries presented in the previous part.) \begin{tabular}{|llllllllll} \hline & Sales Revenue & Date & Explanation & Ref. & Debit & Credit \\ \hline \end{tabular} Prepare a multiple-step income statement through gross profit for the month of May 2022. (Use the ledger balances from part b and assume that no adjustments are necessary.) (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Prepare a multiple-step income statement through gross profit for the month of May 2022. (Use the ledger balances from part b and assume that no adjustments are necessary.) (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

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