Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 20Y7 (unless otherwise indicated), are as follows: 110 Cash $ 83,600 112 Accounts Receivable 233,900 115 Merchandise Inventory 652,400 117 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 Customer Refunds Payable 50,000 212 Salaries Payable — 310 Lynn Tolley, Capital, June 1, 20Y6 685,300 311 Lynn Tolley, Drawing 135,000 410 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 During May, the last month of the fiscal year, the following transactions were completed: May 1. Paid rent for May, $5,000. 3. Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000. 4. Paid freight on purchase of May 3, $600. 6. Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the merchandise sold was $41,000. 7. Received $22,300 cash from Halstad Co. on account. 10. Sold merchandise for cash, $54,000. The cost of the merchandise sold was $32,000. 13. Paid for merchandise purchased on May 3. 15. Paid advertising expense for last half of May, $11,000. 16. Received cash from sale of May 6. 19. Purchased merchandise for cash, $18,700. 19. Paid $33,450 to Buttons Co. on account. 20. Paid Korman Co. a cash refund of $5,000 for damaged merchandise from sale of May 6. Korman Co. kept the merchandise. Record the following transactions on Page 21 of the journal: May 20. Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the merchandise sold was $70,000. 21. For the convenience of Crescent Co., paid freight on sale of May 20, $2,300. 21. Received $42,900 cash from Gee Co. on account. 21. Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000. 24. Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000. 26. Refunded cash on sales made for cash, $800. The defective merchandise was not returned by the customer. 28. Paid sales salaries of $56,000 and office salaries of $29,000. 29. Purchased store supplies for cash, $2,400. 30. Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the merchandise sold was $47,000. 30. Received cash from sale of May 20 plus freight paid on May 21. 31. Paid for purchase of May 21, less return of May 24. Need an adjusted trial balance. Tried to get it to balance properly.

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 20Y7 (unless otherwise indicated), are as follows: 110 Cash $ 83,600 112 Accounts Receivable 233,900 115 Merchandise Inventory 652,400 117 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 Customer Refunds Payable 50,000 212 Salaries Payable — 310 Lynn Tolley, Capital, June 1, 20Y6 685,300 311 Lynn Tolley, Drawing 135,000 410 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 During May, the last month of the fiscal year, the following transactions were completed: May 1. Paid rent for May, $5,000. 3. Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000. 4. Paid freight on purchase of May 3, $600. 6. Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the merchandise sold was $41,000. 7. Received $22,300 cash from Halstad Co. on account. 10. Sold merchandise for cash, $54,000. The cost of the merchandise sold was $32,000. 13. Paid for merchandise purchased on May 3. 15. Paid advertising expense for last half of May, $11,000. 16. Received cash from sale of May 6. 19. Purchased merchandise for cash, $18,700. 19. Paid $33,450 to Buttons Co. on account. 20. Paid Korman Co. a cash refund of $5,000 for damaged merchandise from sale of May 6. Korman Co. kept the merchandise. Record the following transactions on Page 21 of the journal: May 20. Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the merchandise sold was $70,000. 21. For the convenience of Crescent Co., paid freight on sale of May 20, $2,300. 21. Received $42,900 cash from Gee Co. on account. 21. Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000. 24. Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000. 26. Refunded cash on sales made for cash, $800. The defective merchandise was not returned by the customer. 28. Paid sales salaries of $56,000 and office salaries of $29,000. 29. Purchased store supplies for cash, $2,400. 30. Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the merchandise sold was $47,000. 30. Received cash from sale of May 20 plus freight paid on May 21. 31. Paid for purchase of May 21, less return of May 24. Need an adjusted trial balance. Tried to get it to balance properly.

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

22nd Edition

ISBN:9781305666160

Author:James A. Heintz, Robert W. Parry

Publisher:James A. Heintz, Robert W. Parry

Chapter14: Adjustments And The Work Sheet For A Merchandising Business

Section: Chapter Questions

Problem 4SEB: WORK SHEET EXTENSIONS FOR MERCHANDISE INVENTORY ADJUSTMENTS: PERIODIC INVENTORY SYSTEM The following...

See similar textbooks

Related questions

Question

Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 20Y7 (unless otherwise indicated), are as follows:

110	Cash	$ 83,600
112	Accounts Receivable	233,900
115	Merchandise Inventory	652,400
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	Customer Refunds Payable	50,000
212	Salaries Payable	—
310	Lynn Tolley, Capital, June 1, 20Y6	685,300
311	Lynn Tolley, Drawing	135,000
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

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

May 1.	Paid rent for May, $5,000.
3.	Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, $36,000.
4.	Paid freight on purchase of May 3, $600.
6.	Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, $68,500. The cost of the merchandise sold was $41,000.
7.	Received $22,300 cash from Halstad Co. on account.
10.	Sold merchandise for cash, $54,000. The cost of the merchandise sold was $32,000.
13.	Paid for merchandise purchased on May 3.
15.	Paid advertising expense for last half of May, $11,000.
16.	Received cash from sale of May 6.
19.	Purchased merchandise for cash, $18,700.
19.	Paid $33,450 to Buttons Co. on account.
20.	Paid Korman Co. a cash refund of $5,000 for damaged merchandise from sale of May 6. Korman Co. kept the merchandise.

Record the following transactions on Page 21 of the journal:

May 20.	Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, $110,000. The cost of the merchandise sold was $70,000.
21.	For the convenience of Crescent Co., paid freight on sale of May 20, $2,300.
21.	Received $42,900 cash from Gee Co. on account.
21.	Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, $88,000.
24.	Returned damaged merchandise purchased on May 21, receiving a credit memo from the seller for $5,000.
26.	Refunded cash on sales made for cash, $800. The defective merchandise was not returned by the customer.
28.	Paid sales salaries of $56,000 and office salaries of $29,000.
29.	Purchased store supplies for cash, $2,400.
30.	Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, $78,750. The cost of the merchandise sold was $47,000.
30.	Received cash from sale of May 20 plus freight paid on May 21.
31.	Paid for purchase of May 21, less return of May 24.

Need an adjusted trial balance. Tried to get it to balance properly.

Cash
Accounts Receivable
245,875
Merchandise Inventory
620,200 x
Prepaid Insurance
4,800 v
Store Supplies
4,000 v
Store Equipment
569,500
Accumulated Depreciation-Store Equipment
70,700
Accounts Payable
63,150 V
Customer Refunds Payable
89,270 x
Salaries Payable
13,600
Lynn Tolley, Capital
685,300
Lynn Tolley, Drawing
135,000
Sales
5,316,205
Cost of Merchandise Sold
2,991,950 x
Sales Salaries Expense
727,800 V
Advertising Expense
292,000 v
Depreciation Expense
14,000 V
Store Supplies Expense
9,800 V
Miscellaneous Selling Expense
12,600
Office Salaries Expense
417,700 v
Rent Expense
88,700
Insurance Expense
12,000
Miscellaneous Administrative Expense
7,800 V
6,238,225 x
6,238,225 x

Comprehensive Problem 2
Part 4 and 6:
Note: You must complete parts 1, 2 and 3 before attempting to complete part 4 and part 6. Part 5 is an optional work sheet.
4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete Part 6.
a. Merchandise inventory on May 31
$585,200
b. Insurance expired during the year
12,000
c. Store supplies on hand on May 31
4,000
d. Depreciation for the current year
14,000
e. Accrued salaries on May 31:
Sales salaries
$7,000
Office salaries
6,600
13,600
f. The adjustment for customer refunds and allowances is $60,000.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Financial Reporting in Hyperinflationary Economies

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.