Problem
The following transactions apply to Bob's Bike Shop for Year 1, its first year of operations:
• Acquired $31,000 cash from the issue of common stock.
• Acquired $2,180 of merchandise from Bob Hall, the owner, who had acquired the merchandise prior to opening the shop. Issued common stock to Bob in exchange for the merchandise inventory.
• Purchased $43,300 of inventory on account.
• Paid $2,920 for radio ads.
• Sold inventory for $78,650 cash.
• Paid $9,750 in salary to a part-time salesperson.
• Paid $33,500 on accounts payable (see Event 3).
• Physically counted inventory, which indicated that $7,800 of inventory was on hand at the end of the accounting period.
Task
1) Record each of these transactions in general journal form using the periodic method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
2) Create the necessary closing entries at the end of Year 1, and post them to the appropriate T-accounts.
3) Create a post-closing trial balance.