Prepare and post the closing entries. Record the closing entries on Page 23 of the journal. Indicate closed accounts by inserting a line in both Balance columns opposite the closing entry. Insert the new balance in the owner’s capital account.

Comprehensive Problem 2

Enter the balances of each of the accounts in the appropriate balance column of a four-column account. Write Balance in the Item column and place a check mark in the Posting Reference column. Journalize the transactions for May, starting on Page 20 of the journal.
2. Post the journal to the general ledger, extending the month-end balances to
the appropriate balance columns after all posting is completed. In this
problem, you are not required to update or post to the accounts receivable
and accounts payable subsidiary ledgers.
3. Prepare an unadjusted trial balance.
4. At the end of May, the following adjustment data were assembled. Analyze
and use these data to complete (5) and (6).
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a. Merchandise inventory on May 31 $585,200
b. Insurance expired during the year 12,000
c. Store supplies on hand on May 31 4,000
d. Depreciation for the current year 14,000
e. Accrued salaries on May 31:
Sales salaries $7,000
Office salaries 6,600 13,600
f. The adjustment for customer refunds and allowances is $60,000.
5. Enter the unadjusted trial balance on a 10-column end-of-period spreadsheet, and complete the spreadsheet.
6. Journalize and post the adjusting entries. Record the adjusting entries on Page 22 of the journal.
7. Prepare an adjusted trial balance.
8. Prepare an income statement, a statement of owner’s equity, and a balance sheet.
9. Prepare and post the closing entries. Record the closing entries on Page 23 of the journal. Indicate closed accounts by inserting a line in both Balance columns opposite the closing entry. Insert the new balance in the owner’s capital account.
10. Prepare a post-closing trial balance.