FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Related questions
Question
Big Oak Lumber is a lumber yard on Angel Island. Some of Big Oak’s transactions during the current year are as follows:
Apr. 15 Sold lumber on account to Hard Hat Construction, $19,700. The inventory subsidiary ledger shows the cost of this merchandise was $10,300.
Apr. 19 Purchased lumber on account from LHP Company, $3,700.
May 10 Collected in cash the $19,700
May 19 Paid the $3,700 owed to LHP Company.
Dec. 31 Big Oak’s personnel counted the inventory on hand and determined its cost to be $114,000. The accounting records, however, indicate inventory of $116,500 and a cost of goods sold of $721,000. The physical count of the inventory was observed by the company’s auditors and is considered correct.
Instructions
- Prepare
journal entries to record these transactions and events in the accounting records of Big Oak Lumber. (The company uses a perpetual inventory system.) - Prepare a partial income statement showing the company’s gross profit for the year. (Net sales for the year amount to $1,422,000.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution
Trending nowThis is a popular solution!
Step by stepSolved in 2 steps with 3 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Dogarrow_forwardSeemore Lens Company (SLC) sells contact lenses FOB destination. For the year ended December 31, the company reported Inventory of $72,000 and Cost of Goods Sold of $424,000. a. Included in Inventory (and Accounts Payable) are $10,400 of lenses SLC is holding on consignment. b. Included in SLC's Inventory balance are $5,200 of office supplies held in SLC's warehouse. c. Excluded from SLC's Inventory balance are $8,200 of lenses in the warehouse, ready to send to customers on January 2. SLC reported these lenses as sold on December 31, at a price of $15,400. d. Included in SLC's Inventory balance are $3,100 of lenses that were damaged in December and will be scrapped in January, with zero realizable value. Required: For each item, (a)-(d), prepare the journal entry to correct the balances presently reported. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet < 1 2 Transaction a.…arrow_forwardOn June 3, Larkspur Company sold to Chester Company merchandise having a sale price of $6,000 with terms of 4/10, n/60, f.o.b. shipping point. An invoice totaling $93, terms n/30, was received by Chester on June 8 from John Booth Transport Service for the freight cost. On June 12, the company received a check for the balance due from Chester Company. Prepare journal entries on the Larkspur Company books to record all the events noted above under each of the following bases. (1) Sales and receivables are entered at gross selling price. (2) Sales and receivables are entered at net of cash discounts. No. Date Account Titles and Explanation Debit Creditarrow_forward
- At the beginning of June, Circuit Country has a balance in inventory of $3,000. The following transactions occur during the month of June. June 2 Purchase radios on account from Radio World for $2,700, terms 1/15, n/45.June 4 Pay cash for freight charges related to the June 2 purchase from Radio World, $400.June 8 Return defective radios to Radio World and receive credit, $400.June 10 Pay Radio World in full.June 11 Sell radios to customers on account, $5,000, that had a cost of $3,200.June 18 Receive payment on account from customers, $4,000.June 20 Purchase radios on account from Sound Unlimited for $3,800, terms 3/10, n/30.June 23 Sell radios to customers for cash, $5,300, that had a cost of $3,600.June 26 Return damaged radios to Sound Unlimited and receive credit of $500.June 28 Pay Sound Unlimited in full.Required:1. Assuming that Circuit Country uses a perpetual inventory system, record the transactions.2. Prepare the top section of the multiple-step income statement through…arrow_forwardPepper Company completed the following selected transactions and events during March of this year. (Terms of allcredit sales for the company are 2/10, n/30.) Mar. Sold merchandise on credit to Jennifer Nelson, Invoice No. 954, for P16,800 (cost is P12,200). 4 6 Purchased P1,220 of office supplies on credit from Mack Company. Invoice dated March 3, termsny30. Sold merchandise on credit to Dennie Hoskins, Invoice No. 955, for P10,200 (cost is 6 P8,100). Purchased P52,600 of merchandise, invoice dated March 6, terms 2y10, ny30, from 11 Defore Industries. 12 Borrowed P26,000 cash by giving Commerce Bank a long-term promissory note payable. Received cash payment from Jennifer Nelson for the March 4 sale less the discount (Invoice No. 954). 14 16 Received a P200 credit memorandum from Defore Industries for unsatisfactory merchandise Pepper purchased on March 11 and later returned. Received cash payment from Dennie Hoskins for the March 6 sale less the discount 16 (Invoice No. 955). Purchased…arrow_forwardLevchenko Company purchased inventories from a vendor for $16,000 on July 1. The purchase was financed through a $10,000 note with the remainder paid in cash. The vendor charged an additional $400 for shipping, on account. Levchenko paid a moving company $700 cash to move the inventory to a different warehouse. Interest on the note totaled $50, payable in August. a. Determine the cost to be assigned to the inventory. $ b. Record the transactions using the financial statement effects template. Note: Use negative signs with your answers, when appropriate. Select "N/A" as your answer if a part of the accounting equation is not affected. Transaction a. Inventory purchase b. Shipping charge c. Moving cost d. Interest incurred Totals Cash Asset ♦ ◆ ◆ ◆ 0 + Noncash Asset ◆ ◆ ◆ ◆ 0 Balance Sheet Liabilities ◆ ◆ ◆ 0 Contributed + Capital + Earned Capital ♦ ◆ ♦ ♦ 0 Revenues Income Statement Expenses ◆ ◆ ◆ 0 Net = Income 0arrow_forward
- Church Company completes these transactions and events during March of the current year (terms for all its credit sales are 1/10, n/30). March 1 Purchased $37,000 of merchandise from Van Industries, terms 1/15, n/30. March 2 Sold merchandise on credit to Min Cho, Invoice Number 854, for $14,800 (cost is $7,400). March 3 (a) Purchased $1,110 of office supplies on credit from Gabel Company, terms n/30. March 3 (b) Sold merchandise on credit to Linda Witt, Invoice Number 855, for $7,400 (cost is $3,700). March 6 Borrowed $72,000 cash from Federal Bank by signing a long-term note payable. March 9 Purchased $18,500 of office equipment on credit from Spell Supply, terms n/30. March 10 Sold merchandise on credit to Jovita Albany, Invoice Number 856, for $3,700 (cost is $1,850). March 12 Received payment from Min Cho for the March 2 sale less the discount of $148. March 13 (a) Sent Van Industries Check Number 416 in payment of the March 1 invoice less the discount of $370.…arrow_forwardThe following transactions are for Blossom Company. 1. On December 3, Blossom Company sold $510,000 of merchandise to Crane Co. on account. The cost of the merchandise sold was $336,600. 2. On December 8, Crane Co. returned $25,500 of merchandise purchased on December 3. The cost of the goods was $16,320. 3. On December 13, Blossom Company received the balance due from Crane Co. Prepare a tabular summary to record these transactions for Blossom Company using a perpetual inventory system.arrow_forwardThe following transactions were completed by Hammond Auto Supply during January, which is the first month of this fiscal year. Terms of sale are 2/10, n/30. Jan. 2 Issued Ck. No. 6981 to JSS Management Company for monthly rent, $758. 2 J. Hammond, the owner, invested an additional $3,518 in the business. 4 Bought merchandise on account from Valencia and Company, invoice no. A691, $2,932; terms 2/10, n/30; dated January 2. 4 Received check from Vega Appliance for $972.16 in payment of $992 invoice less discount. 4 Sold merchandise on account to L. Paul, invoice no. 6483, $864. 6 Received check from Petty, Inc., $653.66, in payment of $667 invoice less discount. 7 Issued Ck. No. 6982, $594.86, to Fischer and Son, in payment of invoice no. C1272 for $607 less discount. 7 Bought supplies on account from Doyle Office Supply, invoice no. 1906B, $108; terms net 30 days. 7 Sold merchandise on account to Ellison and Clay,…arrow_forward
- Flint Corporation shipped $20,400 of merchandise on consignment to Gooch Company. Flint paid freight costs of $2,000. Gooch Company paid $480 for local advertising, which is reimbursable from Flint. By year-end, 62% of the merchandise had been sold for $21,500. Gooch notified Flint, retained a 10% commission, and remitted the cash due to Flint. Prepare Flint's journal entry when the cash is received. (Round answers to 0 decimal places, e.g. 1,525. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation (To record the cash remitted to Flint.) (To record the cost of inventory sold on consignment.) Debit Ill Creditarrow_forwardChurch Company completes these transactions and events during March of the current year (terms for all its credit sales are 1/10, n/30). March 1 Purchased $32,000 of merchandise from Van Industries, terms 1/15, n/30. March 2 Sold merchandise on credit to Min Cho, Invoice Number 854, for $12,800 (cost is $6,400). March 3 (a) Purchased $960 of office supplies on credit from Gabel Company, terms n/30. March 3 (b) Sold merchandise on credit to Linda Witt, Invoice Number 855, for $6,400 (cost is $3,200). March 6 Borrowed $72,000 cash from Federal Bank by signing a long-term note payable. March 9 Purchased $16,000 of office equipment on credit from Spell Supply, terms n/30. March 10 Sold merchandise on credit to Jovita Albany, Invoice Number 856, for $3,200 (cost is $1,600). March 12 Received payment from Min Cho for the March 2 sale less the discount of $128. March 13 (a) Sent Van Industries Check Number 416 in payment of the March 1 invoice less the discount of $320.…arrow_forwardThis information relates to Kingbird Co. 1. On April 5, purchased merchandise from Blossom Company for $25,000, terms 2/10, n/30. 2. On April 6, paid freight costs of $500 on merchandise purchased from Blossom. 3. On April 7, purchased equipment on account for $30,000. 4. On April 8, returned $3,500 of April 5 merchandise to Blossom Company. 5. On April 15, paid the amount due to Blossom Company in full. (a)Prepare the journal entries to record the transactions listed above on Kingbird Co.’s books. Kingbird Co. uses a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation Debit Credit 1. choose a transaction date April 5April 6April 7April 8April 15May 4 enter an account title enter a debit amount enter a credit amount…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education