Preparing a merchandiser’s work sheet, preparing financial statements, and preparing clo...

Preparing a merchandiser’s work sheet, preparing financial statements, and preparing closing entries [35—45 min]

Niagra Coolers’ trial balance as of December 31, 2012, follows:

Adjustment data at December 31, 2012:

a. Prepaid rent expired, $2,000

b. Depreciation, $4,500

c. Accrued salaries, $1,400

d. Inventory on hand, $68,800

Requirements

1. Complete the accounting work sheet for the year ended December 31, 2012. Key adjusting entries by letter.

2. Prepare the multi-step income statement, statement of owner’s equity, and balance sheet for the year.

3. Prepare closing entries for the year.