Accounting for Merchandising Operations

Tim Jarosz Company had the following account balances at year-end; Cost of Goods Sold $60,000, Inventory $15,000, Operating Expenses $29,000, Sales Revenue $115,000, Sales Discounts $1,200, and Sales Returns and Allowances $1,700. A physical count of inventory determines that merchandise inventory on hand is $13,600.

Instructions

  1. Prepare the adjusting entry necessary as a result of the physical count.
  2. Prepare closing entries

Solution

a.
Tim Jarosz Company
Adjusting Journal Entries
 
b.
Tim Jarosz Company
Closing Journal Entries
 
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