FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Mr. Ahmed Al Rawahi and Mr. Abdullah Al Rawahi started a business called BEST COMPUTER ACCESSORIES business in Nizwa. They purchase different types of Computer accessories from a Wholesale merchandiser and re-sells to retail merchandiser in Sultanate of Oman. The business follows Periodic Inventory System. Following are the business transactions: Identify all the business transactions in the books of BEST COMPUTER ACCESSORIES
Date
Transactions
1st January 2020
The business purchased 100 numbers of Dell Monitors at a cost of OMR 70 each from Rahman Computers (Wholesale merchandiser) The payment terms are 5/10, n/30.
3rd January 2020
Purchased 100 numbers of Acer Keyboard at a cost of OMR 60 each from Computer Supplies LLC. The payment terms are 3/10, n/30. Trade discount was given by the supplier @ 5% on the invoice price.
5th January 2020
The business discovers that 20 numbers of Dell monitors are HP monitors. Therefore, these goods are returned to Rahman Computers and requested for full refund.
9th January 2020
Rahman computers were settled with full payment.
15th February 2020
The business sold 80 numbers of Dell monitors at a Cost OMR 100 each to Nizwa Computers (a retail merchandiser). The payment terms are 2/10,n/60.
20th February 2020
Nizwa Computers discovers that 25 Dell monitors which was purchased on 15th February 2020 are slightly damaged. The customer decides to keep the monitors but receives a sales allowance OMR 10 per monitor.
Identify the journal entry on 3rd January 2020:
a.
Debit Merchandise Inventory OMR 6000 Credit Accounts Payable OMR 6000
b.
Debit Purchase OMR 5700 Credit Accounts payable OMR 5700
c.
Debit Accounts receivable OMR 5700 Credit Sales OMR 5700
d.
Debit Merchandise Inventory OMR 5529 Credit Accounts payable OMR 5529
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