Required informatiorn /The folowing information applies to the questions display
ID: 2394879 • Letter: R
Question
Required informatiorn /The folowing information applies to the questions displayed below) Part 1 of 2 The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company 25 points NELSON COMPANY Unadjusted Trial Balance anuary 31, 2017 Debit 1.850o 14 500 S, 900 2 500 42,900 Cash Merchandise inventory Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable d. Nelson, Capital J. Nelson, Withdrawals sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense Store e Salaries expense Insurance expense eBook 19,900 16,000 10/000 Print 2, 150 References 114,900 2050 2,150 38 000 quipnent 29,500 17 000 9 200 Store supplies expense dvertising expense Totals $167,800 $167,800 Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system. Additional Information: a. Store supplies still available at fiscal year-end amount to $1,650 b. Expired insurance, an administrative expense, for the fiscal year is $1,350 c. Depreciation expense on store equipment, a selling expense, is $1,675 for the fiscal year To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,200 of inventory is still available at fiscal year-end. Required: 1. Using the above information prepare adjusting journal entries: K Prev TOSHIBAExplanation / Answer
Adjusting journal entries
No
General Journal
Debit
Credit
a
Supplies Expenses
$ 4,250.00
Store Supplies
$ 4,250.00
(supplies Consumed)
b
Insurance Expenses
$ 1,350.00
Prepaid Insurance
$ 1,350.00
(Insurance Expired booked as expense)
c
Depreciation Expenses-Store Equipment
$ 1,675.00
Accumulated Depreciation -Store Equipment
$ 1,675.00
(Depreciation expenses )
d
Loss of Inventory
$ 4,300.00
Inventories
$ 4,300.00
(Inventory loss during year)
Nelson Company
Multi step Income Statement
for the year ended January 31 2017
Revenues
Sales
$ 114,900.00
Less: Sales Discount
$ 2,050.00
Less: Sales returns and Allowances
$ 2,150.00
$ 4,200.00
Net Sales
$ 110,700.00
Cost of Goods Sold
$ 38,000.00
Gross Profit
$ 72,700.00
Selling Expenses
Depreciation Expenses
$ 1,675.00
Advertisement Expenses
$ 9,200.00
$ 10,875.00
General and Administrative Expenses
Insurance Expenses
$ 1,350.00
Store Supplies Expenses
$ 1,650.00
Rent Expenses
$ 17,000.00
Salaries Expenses
$ 29,500.00
$ 49,500.00
Other
Loss of Inventory
$ 4,300.00
Net Income
$ 8,025.00
Nelson Company
Single Step Income Statement
for the year ended January 31 2017
Sales Revenue
$ 110,700.00
Cost of Goods Sold
$ 38,000.00
Gross Profit
$ 72,700.00
Depreciation Expenses
$ 1,675.00
Advertisement Expenses
$ 9,200.00
Insurance Expenses
$ 1,350.00
Store Supplies Expenses
$ 1,650.00
Rent Expenses
$ 17,000.00
Salaries Expenses
$ 29,500.00
Loss of Inventory
$ 4,300.00
Net Income
$ 8,025.00
Adjusting journal entries
No
General Journal
Debit
Credit
a
Supplies Expenses
$ 4,250.00
Store Supplies
$ 4,250.00
(supplies Consumed)
b
Insurance Expenses
$ 1,350.00
Prepaid Insurance
$ 1,350.00
(Insurance Expired booked as expense)
c
Depreciation Expenses-Store Equipment
$ 1,675.00
Accumulated Depreciation -Store Equipment
$ 1,675.00
(Depreciation expenses )
d
Loss of Inventory
$ 4,300.00
Inventories
$ 4,300.00
(Inventory loss during year)
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