60.1K

Verified Solution

Link Copied!

Valley Companys adjusted trial balance on August 31, 2017, its fiscal year-end, follows.

		Debit			Credit
Merchandise inventory		$	40,500
Other (noninventory) assets			45,830
Total liabilities					$	25,400
K. Valley, Capital						22,000
K. Valley, Withdrawals			8,500
Sales						225,800
Sales discounts			2,220
Sales returns and allowances			13,000
Cost of goods sold			74,200
Sales salaries expense			32,500
Rent expenseSelling space			8,800
Store supplies expense			1,800
Advertising expense			13,000
Office salaries expense			29,100
Rent expenseOffice space			3,300
Office supplies expense			450
Totals		$	273,200		$	273,200

On August 31, 2016, merchandise inventory was $25,400. Supplementary records of merchandising activities for the year ended August 31, 2017, reveal the following itemized costs.

Invoice cost of merchandise purchases	$	91,600
Purchases discounts received		2,900
Purchases returns and allowances		4,300
Costs of transportation-in		4,900

Required:

1. Prepare closing entries as of August 31, 2017 (the perpetual inventory system is used).

Answer & Explanation Solved by verified expert

See Answer