33:010:272 Lecture Notes - Lecture 6: Accounting Equation, Shoplifting, Net Income
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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)Γ’ΒΒ(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. |
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 $8,797). $11,200 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition), for cash refund (original cost of merchandise $60). 100 c. Sold merchandise (costing $2,375) to a customer, on account with terms 2/10, n/30. 5,000 d. Collected half of the balance owed by the customer in (c) within the discount period. 2,450 e. Granted a partial allowance relating to credit sales that the customer in (c) had not yet paid 80
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Compute Sales Revenue, Net Sales, and Gross Profit for Hair World. 2.
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