Use the data for Rusio Company in Problem 5-4A to complete the following requirements.
Required
1. Prepare closing entries as of August 31, 2009 (the perpetual inventory system is used).
Analysis Component
2. The company makes all purchases on credit, and its suppliers uniformly offer a 3% sales discount.
Does it appear that the company’s cash management system is accomplishing the goal of taking all
available discounts? Explain.
3. In prior years, the company experienced a 4% returns and allowance rate on its sales, which means
approximately 4% of its gross sales were eventually returned outright or caused the company to grant
allowances to customers. How do this year’s results compare to prior years’ results?
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