Question

Work Sheet Extensions for Merchandise Inventory Adjustments: Periodic Inventory System

1. Complete the Adjustments columns for the merchandise inventory.

2. Extend the merchandise inventory to the Adjusted Trial Balance and Balance Sheet columns.

3. Extend the remaining accounts to the Adjusted Trial Balance and Income Statement columns.

4. Prepare a cost of goods sold section from the partial worksheet.

The following partial worksheet is taken from Kevin's Gift Shop for the year ended December 31, 20--. The ending merchandise inventory is $51,330.

Merchandising Inventory:

1. Complete the Adjustments columns for the merchandise inventory.

2. Extend the merchandise inventory to the Adjusted Trial Balance and Balance Sheet columns.

3. Extend the remaining accounts to the Adjusted Trial Balance and Income Statement columns.

Answer 1

Kevin's Gift Shop
Work Sheet (Partial)
For Year Ended December 31, 20--
Account Title	Trial Balance		Adjustments		Adjusted Trial Balance		Income Statement		Balance Sheet
	Debit	Credit	Debit	Credit	Debit	Credit	Debit	Credit	Debit	Credit
Merchandise Inventory	40870		51330	40870	51330				51330
Income Summary			40870	51330	40870	51330	40870	51330
Purchases	88875				88875		88875
Purchases Returns and Allowances		2045				2045		2045
Purchases Discounts		2900				2900		2900
Freight-In	415				415		415

4.

Kevin's Gift Shop
Cost of Goods Sold Section
Cost of goods sold:
Beginning inventory			40870
Purchases		88875
Purchases Returns and Allowances	2045
Purchases Discounts	2900	4945
Net purchases		83930
Freight-In		415
Total purchases			84345
Cost of goods available for sale			125215
Ending inventory			51330
Cost of goods sold				73885

Note: Kindly use minus signs if required in the cost of goods sold section since no instructions have been given regarding the same.