How to solve this problem? How does the answer look all solved? I am struggling to answering this problem please help # Chapter 15: Accounting for Retail Businesses## Appendix 2**BR 5-10B: Periodic inventory accounts, multiple-step income statement, closing entries**On June 30, 2019, the balances of the accounts appearing in the ledger of Simkins Company are as follows:- **Cash:** $12,500- **Accounts Receivable:** $130,000- **Inventory, July 1, 2018:** $84,500- **Estimated Returns Inventory:** $3,000- **Office Supplies:** $3,500- **Prepaid Insurance:** $7,000- **Land:** $90,000- **Office Equipment:** $250,000- **Accumulated Depreciation—Office Equipment:** $110,000- **Accounts Payable:** $75,000- **Salaries Payable:** $5,000- **Common Stock:** $150,000- **Retained Earnings:** $60,000- **Dividends:** $2,750- **Sales:** $645,000- **Purchases:** $310,000- **Purchases Returns and Allowances:** $8,000- **Purchases Discounts:** $4,500- **Freight In:** $13,200- **Sales Returns and Allowances:** $14,000- **Sales Discounts:** $10,500- **Cost of Merchandise Sold:** $289,000- **Advertising Expense:** $15,000- **Office Salaries Expense:** $118,000- **Delivery Expense:** $33,500- **Depreciation Expense:** $25,000- **Miscellaneous Selling Expense:** $8,500- **Insurance Expense:** $9,000- **Rent Revenue:** $32,500- **Miscellaneous Administrative Expense:** $2,000- **Interest Expense:** $16,000### Instructions1. Does Simkins Company use a periodic or perpetual inventory system? Explain.2. Prepare a multiple-step income statement for Simkins Company for the year ended June 30, 2019.3. The estimated cost of merchandise inventory for June 30, 2019, is $36,000.4. Prepare the closing entries for Simkins Company as of June 30, 2019.5. What would

Multi-step income statement: It is the presentation of a normal income statement in a more detailed manner. In this statement, both the revenues and expenses are divided into operating and non-operating. This statement shows both the gross profit and the net profit. Closing entries: These entries are passed to close the revenues, expenses, income/loss and any withdrawals to the capital account. Periodic inventory system: Under this inventory system, the records of inventory are only updated at the end of the period. All the purchases are recorded by using a purchases account and any returns are recorded using a purchase returns and allowances account. Perpetual inventory system: Under this inventory system, the records of inventory are continuously updated by the organization by recording every transaction of purchase or sale or issue to production.In case of multiple sub-parts only 3 sub-parts will be answered. If you want other sub-parts to be answered, please post the entire question separately and mention the sub-parts to be answered. 1. Under the periodic inventory system the inventory records are not continuously updated. So, no separate inventory account is maintained and all the purchases are recorded using the purchase account. Under the perpetual inventory system, the inventory records are updated continuously and a merchandise inventory account is maintained and all the purchases and sales of inventory are recorded using that account. In the question, purchases account is given to record all the purchases of inventory. Thus, S Company is using periodic inventory system.2. Prepare a multi step income statement:3. Prepare closing entries:

Answered: How to solve this problem? How does the…

Business

Accounting

How to solve this problem? How does the answer look all solved? I am struggling to answering this problem please help

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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