The following unadjusted trial balance is prepared at fiscal year end for Rex Company.
REX COMPANY
Unadjusted Trial Balance
January 31,2011
Debit
Credit
Cash
$
29,800
Merchandise inventory
13,500
Store supplies
5,800
Prepaid insurance
2,200
Store equipment
42,600
Accumulated depreciation”Store equipment
$
17,100
Accounts payable
16,000
T. Rex, Capital
37,000
T. Rex, Withdrawals
2,250
Sales
114,750
Sales discounts
1,950
Sales returns and allowances
2,150
Cost of goods sold
38,000
Depreciation expense”Store equipment
0
Salaries expense
25,200
Insurance expense
0
Rent expense
12,000
Store supplies expense
0
Advertising expense
9,400
Totals
$
184,850
$
184,850
Rent expense and salaries expense are equally divided between selling activities and the general and administrative activities. Rex Company uses a perpetual inventory system.
a.
Store supplies still available at fiscal year end amount to $1,700.
b.
Expired insurance, an administrative expense, for the fiscal year is $1,650.
c.
Depreciation expense on store equipment, a selling expense, is $1,675 for the fiscal year.
d.
To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,300 of inventory is still available at fiscal year end.
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