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Cash Merchandise inventory Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable Common stock Retained earnings Dividends NELSON COMPANY Unadjusted Trial Balance January 31 Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Sales salaries expense office salaries expense Insurance expense Rent expense-Selling space Rent expense-Office space Store supplies expense Advertising expense Totals Additional Information: Debit $ 19,800 14,500 5,300 2,600 42,500 2,250 2,000 2,200 38,000 0 14,600 14,600 0 9,000 9,000 0 9,200 $ 185,550 Credit $ 19,150 15,000 4,000 31,000 116,400 $ 185,550 a. Store supplies still available at fiscal year-end amount to $3,000. b. Expired insurance, an administrative expense, is $1,450 for the fiscal year. c. Depreciation expense on store equipment, a selling expense, is $1,550 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,500 of inventory is still available at fiscal year-end.

Cash Merchandise inventory Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable Common stock Retained earnings Dividends NELSON COMPANY Unadjusted Trial Balance January 31 Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Sales salaries expense office salaries expense Insurance expense Rent expense-Selling space Rent expense-Office space Store supplies expense Advertising expense Totals Additional Information: Debit $ 19,800 14,500 5,300 2,600 42,500 2,250 2,000 2,200 38,000 0 14,600 14,600 0 9,000 9,000 0 9,200 $ 185,550 Credit $ 19,150 15,000 4,000 31,000 116,400 $ 185,550 a. Store supplies still available at fiscal year-end amount to $3,000. b. Expired insurance, an administrative expense, is $1,450 for the fiscal year. c. Depreciation expense on store equipment, a selling expense, is $1,550 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,500 of inventory is still available at fiscal year-end.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Cash Merchandise inventory. Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable Common stock Retained earnings Dividends Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Sales salaries expense office salaries expense NELSON COMPANY Unadjusted Trial Balance January 31 Insurance expense Rent expense-Selling space Rent expense-office space Store supplies expense Advertising expense Totals Additional Information: Problem 4-5A (Algo) Part 4 Current ratio Acid-test ratio Gross margin ratio Debit $ 19,800 14,500 5,300 2,600 42,500 2,250 1 2,000 2,200 38,000 0 14,600 14,600 0 9,000 9,000 0 9,200 $ 185,550 1 Credit $ 19,150 15,000 a. Store supplies still available at fiscal year-end amount to $3,000. b. Expired insurance, an administrative expense, is $1,450 for the fiscal year. 4,000 31,000 c. Depreciation expense on store equipment, a selling expense, is $1,550 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,500 of inventory is still available at fiscal year-end. 116,400 $ 185,550 4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31. Note: Round your answers to 2 decimal places.
Transcribed Image Text:Cash Merchandise inventory. Store supplies Prepaid insurance Store equipment Accumulated depreciation-Store equipment Accounts payable Common stock Retained earnings Dividends Sales Sales discounts Sales returns and allowances Cost of goods sold Depreciation expense-Store equipment Sales salaries expense office salaries expense NELSON COMPANY Unadjusted Trial Balance January 31 Insurance expense Rent expense-Selling space Rent expense-office space Store supplies expense Advertising expense Totals Additional Information: Problem 4-5A (Algo) Part 4 Current ratio Acid-test ratio Gross margin ratio Debit $ 19,800 14,500 5,300 2,600 42,500 2,250 1 2,000 2,200 38,000 0 14,600 14,600 0 9,000 9,000 0 9,200 $ 185,550 1 Credit $ 19,150 15,000 a. Store supplies still available at fiscal year-end amount to $3,000. b. Expired insurance, an administrative expense, is $1,450 for the fiscal year. 4,000 31,000 c. Depreciation expense on store equipment, a selling expense, is $1,550 for the fiscal year. d. To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,500 of inventory is still available at fiscal year-end. 116,400 $ 185,550 4. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31. Note: Round your answers to 2 decimal places.
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