Quiz in Financial Statements Preparation

PANDA Merchandising Co. is a sole proprietorship type of business, owned and managed
by Pamela Cruz. She is engage in the buy and sell of school and office supplies.
At the end of the accounting period, the records shows the following adjusted accounts
and balances as of December 31, 2018.

Instructions:
(1) Prepare the following financial statements for the year ended December 31, 2018
a) Income Statement
b) Capital Statement
c) Classified Statement of Financial Position
(2) Journalize the Closing Entries at the end of the accounting period.

Adjusted Trial Balance

Account Titles Debit Credit
Cash 16,000.00
Accounts Receivable 46,250.00
Allowance for bad debts 4,625.00
Merchandise inventory 38,000.00
Prepaid Insurance 2,150.00
Store Supplies 650.00
Office Supplies 375.00
Store Equipment 36,000.00
Accumulated Depreciation- Store Equip. 7,200.00
Office Equipment 20,000.00
Accumulated Depreciation- Office Equip. 4,000.00
Accounts Payable 28,500.00
Salaries Payable 4,500.00
Unearned Rent 12,200.00
Notes Payable (final payment 2020) 32,450.00
Pamela Cruz, Capital 62,500.00
Pamela Cruz , Drawing 10,000.00
Income Summary 45,000.00 38,000.00
Sales 398,000.00
Sales Return and Allowances 6,500.00
Sales Discount 3,500.00
Purchases 270,000.00
Purchases Returns and allowances 6,000.00
Purchases Discount 4,400.00
Transportation-In 4,100.00
Sales Salaries Expense 38,625.00
Advertising Expense 12,500.00
Depreciation Expense- Store Equip. 4,750.00
Store Supplies Expense 1,475.00
Uncollectible Accounts Expense 5,625.00
Miscellanous Expense 800.00
Office Salaries Expense 23,575.00
Rent Expense 13,000.00
Insurance Expense 2,700.00
Depreciation Expense- Office Equip. 2,900.00
Office Supplies Expense 1,675.00
Miscellanous Administrative 825.00
Rent Revenue 10,400.00
Interest Expense 5,800.00
TOTALS 612,775.00 612,775.00