Blossom Manufacturing Inc. shipped finished goods inventory with a total cost of $56,700 to Wildhorse Retailing Ltd. on May 1. The agreement between the two companies was that Wildhorse was to sell the product on consignment for Blossom Manufacturing. Blossom paid $4,800 in shipping costs in order to ship the merchandise. Wildhorse paid a local newspaper $1,500 for advertising costs (which Blossom promised to reimburse). At September 30, the end of the accounting year for both companies, Wildhorse had sold 75% of the merchandise for total sales of $60,000. Wildhorse notified Blossom of the sales, retained a 20% commission, and remitted the cash due to Blossom. (a) Prepare the journal entries required by the above transactions on the books of Blossom Manufacturing. (Round answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Use 'Revenue from Consignment Sales' for the entry.)
Blossom Manufacturing Inc. shipped finished goods inventory with a total cost of $56,700 to Wildhorse Retailing Ltd. on May 1. The agreement between the two companies was that Wildhorse was to sell the product on consignment for Blossom Manufacturing. Blossom paid $4,800 in shipping costs in order to ship the merchandise. Wildhorse paid a local newspaper $1,500 for advertising costs (which Blossom promised to reimburse). At September 30, the end of the accounting year for both companies, Wildhorse had sold 75% of the merchandise for total sales of $60,000. Wildhorse notified Blossom of the sales, retained a 20% commission, and remitted the cash due to Blossom. (a) Prepare the journal entries required by the above transactions on the books of Blossom Manufacturing. (Round answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries. Use 'Revenue from Consignment Sales' for the entry.)
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter8: Current And Contingent Liabilities
Section: Chapter Questions
Problem 7MCQ
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