Hanna Sports is a retailer that specializes in athletic equipment

| June 13, 2018

Hanna Sports is a retailer that specializes in athletic equipment. The corporate strategy isto focus on towns with a population of less than 25,000 people, thereby avoiding head-tohead competition with large retail chains. Following is Hanna’s adjusted trial balance forthe year 20X7. Hanna’s ending inventory is $525,525.HANNA SPORTS CORPORATIONAdjusted Trial BalanceAs of December 31, 20X7DebitsCash$Credits644,909$-Accounts receivable333,654-Inventory, Jan. 1433,477-Equipment488,765-Accumulated depreciation-144,895Accounts payable-111,888Loan payable-500,900Capital stock-250,000Retained earnings, Jan. 1-322,43325,000–3,665,66723,112-144,367-2,198,560-Purchase discounts-114,432Purchase returns and allowances-26,34173,091-Selling expenses185,312-Rent expense262,000-Interest expense60,400-Salaries expense200,700-63,209-DividendsSalesSales discountsSales returns and allowancesPurchasesFreight-inDepreciation expense$(a) Prepare a comprehensive income statement.(b) Prepare closing entries.5,136,556$5,136,556Name:Date:Section:HANNA SPORTS CORPORATIONIncome StatementFor the Year Ending December 31, 20X7RevenuesCost of goods soldGross profitExpensesNet incomeI-05.03(a)Name:Date:I-05.03(b)Section:GENERAL JOURNALDatePageAccountsDec. 31To close income statement accounts witha credit balance, and establish endinginventory balanceDec. 31To close income statement accounts witha debit balance, and remove thebeginning inventory balanceDec. 31To close Income Summary to RetainedEarningsDec. 31To close Dividends to Retained EarningsDebitCreditName:Date:Section:I-05.03(b)

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