FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Sara’s Market recorded the following events involving a recent purchase of merchandise: Received goods for $150,000, terms 2/10, n/40. Returned $3,000 of the shipment for credit. Paid $750 freight on the shipment. Paid the invoice within the discount period. As a result of these events, the company’s merchandise inventory increased by $147,750. increased by $144,810. increased by $144,795 increased by $144,060.arrow_forwardThe company purchased merchandise for ₱54,252 less 2 less 2 on terms 2/10, n/30. How much should the company pay if the account was paid in full within the discount period?arrow_forwardAmerican Steel accepted returned merchandise purchased on account by Sky Builders for, $14,450, plus sales tax of $1,100. What is the journal entry for American Steel to record this transaction? Debit Sales, $15,550; Credit Accounts Receivable/Sky Builders, $15,550. O Debit Sales Returns and Allowances, $14,450, Sales Tax Payable, $1,100; Credit Accounts Receivable/Sky Builders, $15,550. O Debit Accounts Receivable/Sky Builders, $15,550; Credit Sales Returns and Allowances, $14,450, Sales Tax Payable, $1,100. Debit Accounts Receivable/Sky Builders, $15,550; Credit Sales, $15,550. %24arrow_forward
- A company makes a credit sale of $1,000 on June 13 according to the payment terms 5/10, n/30. On June 16, there is a return of $100. The buyer makes the payment for the remaining amount by utilizing the discount. What should be the amount to be paid? O A) $855 B) $900 C) $950 D) $810 E) $600arrow_forwardYour company completed the following merchandise transactions during year 6: 1. On January 1, Year 6, your company had merchandise which cost $18,000 and had a net realizable value of $17,900. 2. Purchased $23,000 of merchandise for cash 3. Sold $19,000 of the merchandise for $36,400 on account. 4. Purchased $10,000 of merchandise on account, terms 2/10, n/30. 5. Paid for the merchandise in #3 on the eighth day after the purchase. 6. There were other purchases and sales throughout the year, but you do not need to record them, so no entry here. 7. Ended the year with merchandise which cost $26,000 (according to your calculations) and had a net realizable value of $25,400. INSTRUCTIONS: a. Prepare the entries for the transactions above assuming a Periodic inventory system, the allowance method for LCNRV, and the net method for purchase discounts. b. Prepare the entries for the transactions above assuming a Perpetual inventory system, the direct inventory reduction method for LCNRV, and…arrow_forwardOn December 28, 20Y3, Silverman Enterprises sold $20,000 of merchandise to Beasley Co. with terms n/30. The cost of the goods sold was $12,000. On December 31, 20Y3, Silverman prepared its adjusting entries, yearly financial statements, and closing entries. On January 3, 20Y4, Silverman Enterprises issued Beasley Co. a credit memo for returned merchandise. The invoice amount of the returned merchandise was $4,000 and the merchandise originally cost Silverman Enterprises $2,350. Question Content Area a. Journalize the entries by Silverman Enterprises to record the December 28, 20Y3, sale. If an amount box does not require an entry, leave it blank. b. Journalize the entries by Silverman Enterprises to record the merchandise returned by Beasley Co. on January 3, 20Y4. If an amount box does not require an entry, leave it blank.arrow_forward
- On December 28, 20Y3, Silverman Enterprises sold $17,500 of merchandise to Beasley Co. with terms 2/10, n/30. The cost of the goods sold was $11,900. On December 31, 20Y3, Silverman prepared its adjusting entries, yearly financial statements, and closing entries. On January 3, 20Y4, Silverman Enterprises issued Beasley Co. a credit memo for returned merchandise. The invoice amount of the returned merchandise was $4,400 and the merchandise originally cost Silverman Enterprises $2,450. a. Journalize the entries by Silverman Enterprises to record the December 28, 20Y3 sale, using the net method under a perpetual inventory system. If an amount box does not require an entry, leave it blank. 20Y3 Dec. 28 20Y3 Dec. 28 b. Journalize the entries by Silverman Enterprises to record the merchandise returned by Beasley Co. on January 3, 20Y4. If an amount box does not require an entry, leave it blank. 20Y4 Jan. 3 20Y4 Jan. 3 c. Journalize the entry to record the receipt of the amount due by Beasley…arrow_forwardCompany X sold merchandise for $50,000 with terms 3/30, n/90 on January 1. On January 29, Company X received half the payment in cash. On March 1, they received the remaining half. Prepare the journal entries to record the sale and the receipt of cash under (1) the gross method and (2) the net method. What effect does using the gross method vs. the net method have on the company’s current ratio after the sale? After the receipt of cash?arrow_forward
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