Please solve part d and e only. P5-6A Wolcott Warehouse Store has an August 31 fiscal year end and uses a perpetual inventory system.An alphabetical list of its account balances at August 31, 2014, follows. All accounts have normal balances.$960Accounts payableAccounts receivable$ 30,00020,000Interest revenueMerchandise inventoryNotes payable57,440Accumulated depreciation-36,000equipment26,720Notes receivable32,000Cash12,525Rent expense16,000Cost of goods sold569,680Sales703,360Depreciation expense6,680Sales discounts3,70066,800Sales returns and allowances14,440EquipmentFreight out4,720Supplies expense5,840Insurance expense2,895Unearned revenue6,0402,16072,680Interest expenseInterest receivableV. Wolcott, capitalV. Wolcott, drawings24060,640Additional information:1. All adjustments have been recorded and posted except for the inventory adjustment. According tothe inventory count, the company has $55,000 of merchandise on hand.2. Last year Wolcott Warehouse Store had a gross profit margin of 20% and a profit margin of 10%.Instructions(a) Prepare any additional required adjusting entries.(b) Prepare a single-step income statement.(c) Prepare a multiple-step income statement.(d) Calculate gross profit margin and profit margin. Compare with last year's margins and comment onthe results.(e) Prepare the closing entries. Post to the Income Summary account. Before closing the Income Sum-mary account, check that the balance is equal to profit.

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P5-6A Wolcott Warehouse Store has an August 31 fiscal year end and uses a perpetual inventory system. An alphabetical list of its account balances at August 31, 2014, follows. All accounts have normal balances. $ 30,000 $ 960 Accounts payable Accounts receivable 20,000 Interest revenue Merchandise inventory Notes payable 57,440 Accumulated depreciation- 36,000 equipment 26,720 Notes receivable 32,000 Cash 12,525 Rent expense 16,000 Cost of goods sold 569,680 Sales 703,360 Depreciation expense 6,680 Sales discounts 3,700 66,800 Sales returns and allowances 14,440 Equipment Freight out 4,720 Supplies expense 5,840 Insurance expense 2,895 Unearned revenue 6,040 Interest expense 2,160 V. Wolcott, capital 72,680 Interest receivable 240 V. Wolcott, drawings 60,640 Additional information: 1. All adjustments have been recorded and posted except for the inventory adjustment. According to the inventory count, the company has $55,000 of merchandise on hand. 2. Last year Wolcott Warehouse Store had a gross profit margin of 20% and a profit margin of 10%. Instructions (a) Prepare any additional required adjusting entries. (b) Prepare a single-step income statement. (c) Prepare a multiple-step income statement.

P5-6A Wolcott Warehouse Store has an August 31 fiscal year end and uses a perpetual inventory system. An alphabetical list of its account balances at August 31, 2014, follows. All accounts have normal balances. $ 30,000 $ 960 Accounts payable Accounts receivable 20,000 Interest revenue Merchandise inventory Notes payable 57,440 Accumulated depreciation- 36,000 equipment 26,720 Notes receivable 32,000 Cash 12,525 Rent expense 16,000 Cost of goods sold 569,680 Sales 703,360 Depreciation expense 6,680 Sales discounts 3,700 66,800 Sales returns and allowances 14,440 Equipment Freight out 4,720 Supplies expense 5,840 Insurance expense 2,895 Unearned revenue 6,040 Interest expense 2,160 V. Wolcott, capital 72,680 Interest receivable 240 V. Wolcott, drawings 60,640 Additional information: 1. All adjustments have been recorded and posted except for the inventory adjustment. According to the inventory count, the company has $55,000 of merchandise on hand. 2. Last year Wolcott Warehouse Store had a gross profit margin of 20% and a profit margin of 10%. Instructions (a) Prepare any additional required adjusting entries. (b) Prepare a single-step income statement. (c) Prepare a multiple-step income statement.

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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