[The following information applies to the questions displayed below.] The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company. Nelson company uses a perpetual inventory system. It categorizes the following accounts as selling expenses: Depreciation Expense—Store Equipment, Sales Salaries Expense, Rent Expense—Selling Space, Store Supplies Expense, and Advertising Expense. It categorizes the remaining expenses as general and administrative.

NELSON COMPANY
Unadjusted Trial Balance
January 31
Debit Credit
Cash $ 20,050
Merchandise inventory 13,500
Store supplies 5,700
Prepaid insurance 2,800
Store equipment 42,700
Accumulated depreciation—Store equipment $ 18,050
Accounts payable 17,000
Common stock 3,000
Retained earnings 29,000
Dividends 2,250
Sales 114,700
Sales discounts 1,850
Sales returns and allowances 2,200
Cost of goods sold 38,000
Depreciation expense—Store equipment 0
Sales salaries expense 12,900
Office salaries expense 12,900
Insurance expense 0
Rent expense—Selling space 8,500
Rent expense—Office space 8,500
Store supplies expense 0
Advertising expense 9,900
Totals $ 181,750 $ 181,750

Additional Information:

Store supplies still available at fiscal year-end amount to $2,200.
Expired insurance, an administrative expense, is $1,700 for the fiscal year.
Depreciation expense on store equipment, a selling expense, is $1,625 for the fiscal year.
To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,700 of inventory is still available at fiscal year-end.
Required:

1. Using the above information, prepare adjusting journal entries.
2. Prepare a multiple-step income statement for the year ended January 31.
3. Prepare a single-step income statement for the year ended January 31.

How is a proportional tax different from a progressive tax? a. a proportional tax decreases with income level, but a progressive tax increases with income level. b. a proportional tax increases with income level, but a progressive tax decreases with income level. c. a proportional tax increases with income level, but a progressive tax is the same percentage for all. d. a proportional tax is the same percentage for all, but a progressive tax increases with income level.

Gino's restaurant is a popular restaurant in boston, massachusetts. the owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. the intern, in consultation with the owner, identified the following major activities: activity cost pool activity measure serving a party of diners number of parties served serving a diner number of diners served serving drinks number of drinks ordered some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. other costs, such as washing plates and glasses, depends on the number of diners served or the number of drinks served. data concerning these activities are shown below. serving a party serving a dinner serving drinks total total cost $47,600 $153,000 $59,800 $260,400 total activity 7,000 parties 30,000 diners 46,000 drinks prior to the activity-based costing study, the owner knew very little about the costs of the restaurant. she knew that the total cost for the month was $260,400 and that 30,000 diners had been served. therefore, the average cost per diner was $8.68.required: 1. compute the activity rates for each of the three activities 2. according to the activity-based costing system, what is the total cost of serving each of the following parties of diners? a. a party of four diners who ordered three drinks in total b. a party of two diners who do not order any drinks c. a lone diner who orders two drinks 3. convert the total costs you computed in part (1) above to costs per diner. in other words, what is the average cost per diner for serving each of the following parties: a. a party of four diners who order three drinks in total b. a party of two diner who do not order any drinks c. a lone diner who orders two drinks 4. why do the costs per diner for the three different parties differ from each other and from the overall average coast of $9.80 per diner?

Financial information that is capable of making a difference in a decision is