Prepare financial statements and adjusting and closing entries

Subject:AccountingPrice: Bought3

Share With

Prepare financial statements and adjusting and closing entries. (LO 4,5) P5-3A Big Box Store is located in midtown Madison. During the past several years, net income has been declining because of suburban shopping centers. At the end of the com- pany's fiscal year on November 30, 2017, the following accounts appeared in two of its trial balances. Accounts Payable Accounts Receivable Accumulated Depr.-Equip. Cash Cost of Goods Sold Freight-Out Equipment Depreciation Expense Insurance Expense Interest Expense Interest Revenue Inventory Unadjusted Adjusted $ 25,200 $ 25,200 Notes Payable 30,500 30,500 Owner's Capital 34,000 45,000 Owner's Drawings 26,000 26,000 Prepaid Insurance 518,000 518,000 Property Tax Expense 6,500 6,500 Property Taxes Payable 146,000 146,000 Rent Expense 11,000 Salaries and Wages Expense 7,000 Sales Revenue 6,400 6,400 Sales Commissions Expense 2,000 2,000 Sales Commissions Payable 32,000 32,000 Sales Returns and Allowances Utilities Expense Unadjusted Adjusted $ 37,000 $ 37,000 101,700 101,700 10,000 10,000 10,500 3,500 2,500 2,500 15,000 15,000 96,000 96,000 720,000 720,000 6,500 11,000 4,500 8,000 8,000 8,500 8,500 (a) Net income $32,100 Owner's capital $123,800 Total assets 5193,000 Instructions (a) Prepare a multiple-step income statement, an owner's equity statement, and a classi- fied balance sheet. Notes payable are due in 2020. (b) Journalize the adjusting entries that were made. C) Journalize the closing entries that are necessary.