i do not understand the text can someone please help explain this with their answer

The Artisan Wines is a retail store selling vintage wines. On December 31, 2019, the firm’s general ledger contained the accounts and balances below. All account balances are normal.

Artisan Wines
Worksheet
Year Ended December 31, 2019
Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet
Account Name Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit
Cash $ 28,386.00 $ 28,386.00 $ 28,386.00
Accounts Receivable 500.00 500.00 500.00
Prepaid Advertising 480.00 160.00 320.00 320.00
Supplies 300.00 140.00 160.00 160.00
Merchandise Inventory 15,000.00 13,000.00 15,000.00 13,000.00 13,000.00
Store Equipment 25,000.00 25,000.00 25,000.00
Accumulated Depreciation—Store Equipment 3,000.00 3,000.00 6,000.00 6,000.00
Office Equipment 5,000.00 5,000.00 5,000.00
Accumulated Depreciation—Office Equipment 1,500.00 1,125.00 2,625.00 2,625.00
Notes Payable, due 2020 20,000.00 20,000.00 20,000.00
Accounts Payable 2,705.00 2,705.00 2,705.00
Wages Payable 500.00 500.00 500.00
Social Security Tax Payable 31.00 31.00 31.00
Medicare Tax Payable 7.25 7.25 7.25
Unearned Seminar Fees 6,000.00 4,000.00 2,000.00 2,000.00
Interest Payable 100.00 100.00 100.00
Vincent Arroyo, Capital 32,700.00 32,700.00 32,700.00
Vincent Arroyo, Drawing 14,110.00 14,110.00 14,110.00
Income Summary 15,000.00 13,000.00 15,000.00 13,000.00 15,000.00 13,000.00
Sales 153,970.00 153,970.00 153,970.00
Sales Discounts 200.00 200.00 200.00
Seminar Fee Income 4,000.00 4,000.00 4,000.00
Purchases 91,000.00 91,000.00 91,000.00
Purchases Returns and Allowances 1,000.00 1,000.00 1,000.00
Freight In 225.00 225.00 225.00
Rent Expense 13,200.00 13,200.00 13,200.00
Wages Expense 24,000.00 500.00 24,500.00 24,500.00
Payroll Taxes Expense 3,324.00 38.25 3,362.25 3,362.25
Depreciation Expense—Store Equipment 3,000.00 3,000.00 3,000.00
Depreciation Expense—Office Equipment 1,125.00 1,125.00 1,125.00
Advertising Expense 160.00 160.00 160.00
Supplies Expense 140.00 140.00 140.00
Interest Expense 150.00 100.00 250.00 250.00
Totals $ 220,875.00 $ 220,875.00 $ 37,063.25 $ 37,063.25 $ 238,638.25 $ 238,638.25 $ 152,162.25 $ 171,970.00 $ 86,476.00 $ 66,668.25
Net Income 19,807.75 19,807.75
$ 171,970.00 $ 171,970.00 $ 86,476.00 $ 86,476.00

Required:

  1. Prepare a classified income statement for the year ended December 31, 2019. The company does not classify its operating expenses as selling expenses and general and administrative expenses.
  2. Prepare a statement of owner’s equity for the year ended December 31, 2019. No additional investments were made during the year.
  3. Prepare a classified balance sheet as of December 31, 2019.

Analyze:
What is the inventory turnover for Artisan Wines?

 
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