ACCT 23020 Lecture Notes - Lecture 20: Mediacorp, Accounts Receivable, Market Liquidity
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On September 12, Vander Company, Inc. sold merchandise in the amount of $5,800 to Jepson Company on credit with terms of 2/10, n/30. The cost of the items sold is $4,000. Vander uses the gross method of accounting for sales and a periodic inventory system. On September 14, Jepson returns some of the merchandise. The selling price of the merchandise is $500 and the cost of the merchandise returned is $350. Jepson pays the invoice on September 18 and takes the appropriate discount. The journal entry that Vander makes on September 18 is:
Cash | 5,684 | |
Sales discounts | 116 | |
Accounts receivable | 5,800 |
Cash | 5,800 | |
Accounts receivable | 5,800 |
Cash | 4,000 | |
Accounts receivable | 4,000 |
Cash | 5,684 | |
Accounts receivable | 5,684 |
Cash | 5,194 | |
Sales discounts | 106 | |
Accounts receivable | 5,300 |
On September 12, Vander Company, Inc. sold merchandise in the amount of $5,800 to Jepson Company on credit with terms of 2/10, n/30. The cost of the items sold is $4,000. Vander uses the gross method of accounting for sales and a periodic inventory system. On September 14, Jepson returns some of the merchandise. The selling price of the merchandise is $500 and the cost of the merchandise returned is $350. Jepson pays the invoice on September 18 and takes the appropriate discount. The journal entry that Vander makes on September 18 is:
Cash | 5,684 | |
Sales discounts | 116 | |
Accounts receivable | 5,800 |
Cash | 5,800 | |
Accounts receivable | 5,800 |
Cash | 4,000 | |
Accounts receivable | 4,000 |
Cash | 5,684 | |
Accounts receivable | 5,684 |
Cash | 5,194 | |
Sales discounts | 106 | |
Accounts receivable | 5,300 |
[The following information applies to the questions displayed below.]
Hair World Inc. is a wholesaler of hair supplies. Hair World uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis: |
a. | Sold merchandise for cash (cost of merchandise $10,797). | $15,200 |
b. | Received merchandise returned by customers as unsatisfactory (but in perfect condition), for cash refund (original cost of merchandise $90). | 150 |
c. | Sold merchandise (costing $2,613) to a customer, on account with terms 2/10, n/30. | 5,500 |
d. | Collected half of the balance owed by the customer in (c) within the discount period. | 2,695 |
e. | Granted a partial allowance relating to credit sales that the customer in (c) had not yet paid | 88 |
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2. | Compute the gross profit percentage. (Round your answer to 1 decimal place.) |
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3. | Prepare journal entries to record transactions (a)â(e). (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) |
a2) Record the cost of goods sold of $10,797. b1) Record the return by a customer of unsatisfactory merchandise that was in perfect condition. A cash refund of $150 was given to the customer. b2) Record the merchandise returned by the customer back into inventory. The original cost of the merchandise was $90. c1) Record the sales on account of $5,500 on terms 2/10, n/30. c2) Record the cost of goods sold of $2,613. d) Record the collection of half of the balance of $2,695 owed by the customer within the discount period. e) Record the allowance of $88 granted to the customer. |