PREPARE AN UNADJUSTED TRAIL BALANCE Palisade Creek Co. is a merchandising busine

Question

PREPARE AN UNADJUSTED TRAIL BALANCE

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2016 (unless otherwise indicated), are as follows:

During May, the last month of the fiscal year, the following transactions were completed:

Record the following transactions on page 20 of the journal. Refer to the Chart of Accounts for exact wording of account titles.

Record the following transactions on page 21 of the journal. Refer to the Chart of Accounts for exact wording of account titles.

Paid for purchase of May 21, less return of May 24.

110 Cash $ 83,600 112 Accounts Receivable 233,900 115 Merchandise Inventory 624,400 116 Estimated Returns Inventory 28,000 117 Prepaid Insurance 16,800 118 Store Supplies 11,400 123 Store Equipment 569,500 124 Accumulated Depreciation-Store Equipment 56,700 210 Accounts Payable 96,600 211 Salaries Payable — 212 Customers Refunds Payable 50,000 310 Common Stock 100,000 311 Retained Earnings 585,300 312 Dividends 135,000 313 Income Summary — 410 Sales 5,069,000 510 Cost of Merchandise Sold 2,823,000 520 Sales Salaries Expense 664,800 521 Advertising Expense 281,000 522 Depreciation Expense — 523 Store Supplies Expense — 529 Miscellaneous Selling Expense 12,600 530 Office Salaries Expense 382,100 531 Rent Expense 83,700 532 Insurance Expense — 539 Miscellaneous Administrative Expense 7,800

Explanation / Answer

Palisade Creek Co. All Amounts in $ Journal Entries Date Patriculars Debit Credit 01/05/2016 Rent Expense A/c 5000 To Cash A/c 5000 03/05/2016 Merchandise Inventory A/c 36000 To Accounts Payable A/c 36000 04/05/2016 Cost of Merchandise Sold A/c 600 To Cash A/c 600 06/05/2016 Accounts Receivable A/c 68500 To Sales A/c 68500 Cost of Merchandise Sold A/c 41000 To Merchandise Inventory A/c 41000 07/05/2016 Cash A/c 22300 To Accounts Receivable A/c 22300 10/05/2016 Cash A/c 54000 To Sales A/c 54000 Cost of Merchandise Sold A/c 32000 To Merchandise Inventory A/c 32000 13/05/2016 Accounts Payable A/c 36000 To Cash A/c 35280 To Cost of Merchandise Sold A/c 720 15/05/2016 Advertising Expense A/c 11000 To Cash A/c 11000 16/05/2016 Cash A/c 67130 Cost of Merchandise Sold A/c 1370 To Accounts Receivable A/c 68500 18/05/2016 Merchandise Inventory A/c 18700 To Cash A/c 18700 19/05/2016 Accounts Payable A/c 33450 To Cash A/c 33450 20/05/2016 Estimated Returns Inventory A/c 13500 To Customer Refund Payable A/c 13500 Cost of Merchandise Sold A/c 8000 To Estimated Returns Inventory A/c 8000 Customer Refund Payable A/c 13500 To Cash A/c 13230 To Cost of Merchandise Sold A/c 270 20/05/2016 Accounts Receivable A/c 110000 To Sales A/c 110000 Cost of Merchandise Sold A/c 70000 To Merchandise Inventory A/c 70000 21/05/2016 Cost of Merchandise Sold A/c 2300 To Cash A/c 2300 Accounts Receivable A/c 2300 To Cost of Merchandise Sold A/c 2300 21/05/2016 Cash A/c 42900 To Accounts Receivable A/c 42900 21/05/2016 Merchandise Inventory A/c 88000 To Accounts Payable A/c 88000 24/05/2016 Accounts Payable A/c 5000 To Estimated Returns Inventory A/c 5000 26/05/2016 Estimated Returns Inventory A/c 7500 To Customer Refund Payable A/c 7500 Cost of Merchandise Sold A/c 4800 To Estimated Returns Inventory A/c 4800 Customer Refund Payable A/c 7500 To Cash A/c 7500 28/05/2016 Sales Salaries A/c 56000 Office Salaries A/c 29000 To Cash A/c 85000 29/05/2016 Store Supplies A/c 2400 To Cash A/c 2400 30/05/2016 Accounts Receivable A/c 78750 To Sales A/c 78750 Cost of Merchandise Sold A/c 47000 To Merchandise Inventory A/c 47000 30/05/2016 Cash A/c 111200 Cost of Merchandise Sold A/c 1100 To Accounts Receivable A/c 112300 31/05/2016 Accounts Payable A/c 83000 To Cash A/c 82170 To Cost of Merchandise Sold A/c 830

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