Chapter 5, Problem 10E

Exercise 5-10 Preparing adjusting and closing entries for a merchandiser P3

The following list includes selected permanent accounts and all of the temporary accounts from the December 31 unadjusted trial balance of Emiko Co.₌ a business owned by Kumi Emiko. Use these account balances along with the additional information to journalize (a) adjusting entries and (5) closing entries. Emiko Co. uses a perpetual inventory system.
Merchandise inventory .......... $30,000
Prepaid selling expenses......... 5,600
K. Emiko. Withdrawals........... 33,000
Sales......................... $529,000
Sales returns and allowances..... 17,500
Sales discounts................. 5,000
Check Dr. 184.500 to close Income Summary

Additional Information

Debit
Cost of goods sold.......	$212,000
Sales salaries expense	48,000
Utilities expense.........	15,000
Selling expenses.........	36,000
Administrative expenses ..	105,000

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Accrued and unpaid sales salaries amount to SI.700. Prepaid selling expenses of S3.000 have expired. A physical count of year-end merchandise inventory is taken to determine shrinkage and shows S2S.700 of goods still available.