PA6-3 (Static) Recording Sales with Discounts and Estimated and Actual Returns, and AnalyzingGross Profit Percentage [LO 6-4, LO 6-5)(The following information applies to the questions displayed below)Hair World Incorporated is a wholesaler of hair supplies. Hair World uses a perpetual inventory system. The followingtransactions (summarized) have been selected for analysis:$ 51,200a. Sold merchandise for cash (cost of merchandise $28,797).b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) forcash refund (original cost of merchandise $220).e. Sold merchandise (costing $4,750) to a customer on account with terms n/60.d. Collected half of the balance owed by the customer in (c).e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid.f. Anticipate further returns of merchandise (costing $140) after year-end from sales made duringthe year.25010,e005,000160350PA6-3 (Static) Part 1Required:1. Compute Net Sales and Gross Profit for Hair World.Net Sales60,600

Cost of goods sold = Cost of goods sold for cash + Cost of goods sold on account - goods returned =…

Answered: Hair World Incorporated is a wholesaler…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 37E: Analyzing the Accounts Casey Company uses a perpetual inventory system and engaged in the following...

See similar textbooks

Similar questions

Analyzing the Accounts Casey Company uses a perpetual inventory system and engaged in the following transactions: a. Made credit sales of $825,000. The cost of the merchandise sold was $560,000. b. Collected accounts receivable in the amount of $752,600. c. Purchased goods on credit in the amount of $574,300. d. Paid accounts payable in the amount of $536,200. Required: Prepare the journal entries necessary to record the transactions. Indicate whether each transaction increased cash, decreased cash, or had no effect on cash.
PA6-3 Recording Sales with Discounts and Returns and Analyzing Gross Profit Percentage [LO 6-4, LO 6-5] [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 $48,797). $ 91,200 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $660 ). 1,100 c. Sold merchandise (costing $9,500 ) to a customer on account with terms n/60. 20,000 d. Collected half of the balance owed by the customer in (c). 10,000 e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 320 PA6-3 Part 2 Compute the gross profit percentage. (Round your answer to 1 decimal place.)
PA6-3 Recording Sales with Discounts and Returns and Analyzing Gross Profit Percentage [LO 6-4, LO 6-5] [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 $48,797). $ 91,200 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $660 ). 1,100 c. Sold merchandise (costing $9,500 ) to a customer on account with terms n/60. 20,000 d. Collected half of the balance owed by the customer in (c). 10,000 e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 320 PA6-3 Part 1 Required: Compute Net Sales and Gross Profit for Hair World.
PA6-3 Recording Sales with Discounts and Returns and Analyzing Gross Profit Percentage [LO 6-4, LO 6-5] [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 $48,797). $ 91,200 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $660 ). 1,100 c. Sold merchandise (costing $9,500 ) to a customer on account with terms n/60. 20,000 d. Collected half of the balance owed by the customer in (c). 10,000 e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 320 PA6-3 Part 4 Hair World is considering a contract to sell merchandise to a hair salon chain for $25,000. This merchandise will…
E5-4 On June 10, Diaz Company purchased $8,000 of merchandise from Taylor Company, FOB shipping point, terms 2/10, n/30. Diaz pays the freight costs of $400 on June 11. Dam- aged goods totaling $300 are returned to Taylor for credit on June 12. The fair value of these goods is $70. On June 19, Diaz pays Taylor Company in full, less the purchase dis- count. Both companies use a perpetual inventory system. Instructions (a) Prepare separate entries for each transaction on the books of Diaz Company. (b) Prepare separate entries for each transaction for Taylor Company. The merchandise purchased by Diaz on June 10 had cost Taylor $4,800. E5-5 Presented below are transactions related to R. Humphrey Company. 1. On December 3, R. Humphrey Company sold $570,000 of merchandise to Frazier Co., terms 1/10, n/30, FOB destination. R. Humphrey paid $400 for freight charges. The cost of the merchandise sold was $350,000. 2. On December 8, Frazier Co. was granted an allowance of $20,000 for merchandise…
Comprest Company has the following account balances: Purchases of $ 10,551, Purchase Returns and Allowances of $ 859, Purchase Discounts of $ 1,578, Freight-In of $ 294, Freight-Out of $ 538,and Beginning Inventory of $ 3,415. What is the Cost of Goods Available for Sale? Please don't provide solutions in an image format thank you
The records of a business show the following information: Sales, P364,000; Purchases, P252,000; Freight-in, P11,000; Purchase discounts, P4,900; Sales returns, P12,600; Purchase returns, P3,000; Inventory, beg. P22,400; and Inventory, end. P15,000. How much is the gross profit? P101,500 P103,700 P99,900 P88,900 How much is the total goods available for sale? Choices: P277,500 P251,500 P262,500 P266,500
E6-21 Analyzing Gross Profit Percentage on the Basis of a Multi-step Income Statement [LO6-5] The following summarized data were provided by the records of Mystery Incorporated for the year ended December 31: Administrative Expense $ 19,000 Cost of Goods Sold 165,000 Income Tax Expense 17,600 Sales Returns and Allowances 7,000 Selling Expense 40,200 Sales of merchandise for cash 240,000 Sales of merchandise on credit 42,000 Required:1. Based on these data, prepare a multi-step income statement for internal reporting purposes. 2-a. What was the amount of gross profit? 2-b. What was the gross profit percentage? 2-c. Which of the following(s) is true? (Select all that apply.) E6-21 Analyzing Gross Profit Percentage on the Basis of a Multi-step Income Statement [LO6-5] The following summarized data were provided by the records of Mystery Incorporated for the year ended December 31:…
M7-17 Calculating Effect of Inventory Errors For each of the following scenarios, determine the effect of the error on income in the current period and in the subsequent period. To answer these questions, rely on the inventory equation: Beginning inventory + Purchases - Cost of goods sold = Ending inventory a. Porter Company received a shipment of merchandise costing $32,000 near the end of the ﬁscal year. The shipment was mistakenly recorded at a cost of $23,000. b. Chiu, Inc., purchased merchandise costing $16,000. When the shipment was received, it was determined that the merchandise was damaged in shipment. The goods were returned to the supplier, but the accounting department was not notiﬁed and the invoice was paid. c. After taking a physical count of its inventory, Murray Corporation determined that it had “shrink” of $12,500, and the books were adjusted accordingly. However, inventory costing $5,000 was never counted
BE5-14 Prepare the journal entries to record these transactions on Shabani Company's books using a periodic inventory system. (a) On March 2, Shabani Company purchased $900,000 of merchandise from Ballas Com- pany, terms 2/10, n/30. (b) On March 6, Shabani Company returned $110,000 of the merchandise purchased on March 2. (c) On March 12, Shabani Company paid the balance due to Ballas Company.
Presented below is information related to Skysong Inc. Cost Retail Inventory, 12/31/17 $251,300 $387,300 Purchases 962,468 1,455,600 Purchase returns 58,800 78,800 Purchase discounts 18,000 — Gross sales revenue — 1,421,800 Sales returns — 98,300 Markups — 117,600 Markup cancellations — 40,500 Markdowns — 45,700 Markdown cancellations — 20,200 Freight-in 41,400 — Employee discounts granted — 7,900 Loss from breakage (normal) — 4,500 Assuming that Skysong Inc. uses the conventional retail inventory method, compute the cost of its ending inventory at December 31, 2018. Please don't provide answer in image format thank you
Presented below is information related to Sage Inc. Cost Retail Inventory, 12/31/20 $245,700 $384,400 Purchases 818,428 1,450,600 Purchase returns 61,000 79,700 Purchase discounts 18,100 — Gross sales revenue — 1,411,200 Sales returns — 97,900 Markups — 118,900 Markup cancellations — 40,400 Markdowns — 44,800 Markdown cancellations — 20,100 Freight-in 41,900 — Employee discounts granted — 8,100 Loss from breakage (normal) — 4,600 Assuming that Sage Inc. uses the conventional retail inventory method, compute the cost of its ending inventory at December 31, 2021.

SEE MORE QUESTIONS

Recommended textbooks for you

Cornerstones of Financial Accounting

Accounting

ISBN:

9781337690881

Author:

Jay Rich, Jeff Jones

Publisher:

Cengage Learning

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

Cornerstones of Financial Accounting

Accounting

ISBN:

9781337690881

Author:

Jay Rich, Jeff Jones

Publisher:

Cengage Learning

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS