Multiple choice C.d.P80, September 257.Apple Co sells merchandise on credit to Zea Co in the amount of P8,000. The iis dated on September 15 with terms of 1/15, net 45. If Zea Co. chooses not sethe discount, by when should the payment be made?September 3ob.a.d.October 3013.to the buIf title toс.d.October 15corSeptember 25n/b.Discounts taken by a buyer because of early payment are recorded on the seller,a.8.C.accounting records asd.a.Purchases discount14. Aca.b.Sales discountC.Trade discountd. Early payment discount9. Who should pay the freight costs when the terms are FOB shipping point?a. the ultimate customerb. the buyerc. the sellerd. either the seller or the buyerhould pthe freisht.co the terms are FOB destination?the sellerthe buyer

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is dated on September 15 with terms of 1/15, net 45. If Zea Co. chooses not to the discount, by when should the payment be made? September 3o October 30 7. a. b. C. October 15 d. September 25 recorded on the sel

is dated on September 15 with terms of 1/15, net 45. If Zea Co. chooses not to the discount, by when should the payment be made? September 3o October 30 7. a. b. C. October 15 d. September 25 recorded on the sel

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 4EB: Laminate Express extended credit to customer Amal Sunderland in the amount of $244,650 for his...

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Question

Multiple choice

C.
d.
P80, September 25
7.
Apple Co sells merchandise on credit to Zea Co in the amount of P8,000. The i
is dated on September 15 with terms of 1/15, net 45. If Zea Co. chooses not se
the discount, by when should the payment be made?
September 3o
b.
a.
d.
October 30
13.
to the bu
If title to
с.
d.
October 15
cor
September 25
n/
b.
Discounts taken by a buyer because of early payment are recorded on the seller,
a.
8.
C.
accounting records as
d.
a.
Purchases discount
14. Ac
a.
b.
Sales discount
C.
Trade discount
d. Early payment discount
9. Who should pay the freight costs when the terms are FOB shipping point?
a. the ultimate customer
b. the buyer
c. the seller
d. either the seller or the buyer
hould pthe freisht.co the terms are FOB destination?
the seller
the buyer

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Purchase-related transactions The following selected transactions were completed by Epic Co. during August of the curr ent year: Aug. 3. Purchased merchandise on account for $33400, terms FOB destination. 2/10. n/30. 9. Issued debit memorandum for $2500 ($2450 net of 2% discount) for merchandise from the August 3 purchase that was damaged in shipment. 10. Purchased merchandise on account, $25,000, terms FOB shipping point, n/com. Paid $600 cash to the freight company for delivery of the merchandise. 13. Paid for invoice of August 3, less debit memorandum of August 9 31. Paid for invoice of August 10. Instructions Illustrate the effects of each of the preceding transactions on the accounts and financial statements of Epic Co. Identify each transaction by date.
Serene Company purchases fountains for its inventory from Kirkland Inc. The following transactions take place during the current year. A. On July 3, the company purchases thirty fountains for $1,200 per fountain, on credit. Terms of the purchase are 2/10, n/30, invoice dated July 3. B. On August 3, Serene does not pay the amount due and renegotiates with Kirkland. Kirkland agrees to convert the debt owed into a short-term note, with an 8% annual interest rate, payable in two months from August 3. C. On October 3, Serene Company pays its account in full. Record the journal entries to recognize the initial purchase, the conversion, and the payment.
The following transactions were completed by Nelsons Hardware, a retailer, during September. Terms on sales on account are 1/10, n/30, FOB shipping point. Sept. 4Received cash from M. Alex in payment of August 25 invoice of 275, less cash discount. 7Issued Ck. No. 8175, 915.75, to Top Tools, Inc., for invoice. no. 2256, recorded previously for 925, less cash discount of 9.25. 10Sold merchandise in the amount of 175 on a credit card. Sales tax on this sale is 8%. The credit card fee the bank deducted for this transaction is 5. 11Issued Ck. No. 8176, 653.40, to Snap Tools, Inc. for invoice no. 726, recorded previously on account for 660. A trade discount of 15% was applied at the time of purchase, and Snap Tools, Inc.s credit terms are 1/10, n/45. 15Received 95 cash in payment of August 20 invoice from N. Johnson. No cash discount applied. 19Received 1,165 cash in payment of a 1,100 note receivable and interest of 65. 22Voided Ck. No. 8177 due to error. 26Received and paid telephone bill, 62; Ck. No. 8178, payable to Southern Telephone Company. 30Paid wages recorded previously for the month, 3,266, Ck. No. 8179. Required 1. Journalize the transactions for September in the cash receipts journal, the general journal (for the transaction on Sept. 10th), or the cash payments journal as appropriate. Assume the periodic inventory method is used. 2. If you are using Working Papers, total and rule the journals. Prove the equality of debit and credit totals.
Laminate Express extended credit to customer Amal Sunderland in the amount of $244,650 for his January 4 purchase of flooring. Terms of the sale are 2/30, n/120. The cost of the purchase to Laminate Express is $88,440. On April 5, Laminate Express determined that Amal Sunderlands account was uncollectible and wrote off the debt. On June 22, Amal Sunderland unexpectedly paid 30% of the total amount due in cash on his account. Record each Laminate Express transaction with Amal Sunderland. In order to demonstrate the write-off and then subsequent collection of an account receivable, assume in this example that Laminate Express rarely extends credit directly, so this transaction is permitted to use the direct write-off method. Remember, though, that in most cases the direct write-off method is not allowed.
Record the following transactions in general journal form. a. Sold merchandise on account to A. Bauer, 680 plus 54.40 sales tax (invoice no. D446). b. Bauer returned 105.50 of the merchandise. Issued credit memo no. 114 for 113.94 (105.50 for the amount of the sale plus 8.44 for the amount of the sales tax).
Air Compressors Inc. purchases compressor parts for its inventory from a supplier. The following transactions take place during the current year: A. On April 5, the company purchases 400 parts for $8.30 per part, on credit. Terms of the purchase are 4/ 10, n/30, invoice dated April 5. B. On May 5, Air Compressors does not pay the amount due and renegotiates with the supplier. The supplier agrees to $400 cash immediately as partial payment on note payable due, converting the debt owed into a short-term note, with a 7% annual interest rate, payable in three months from May 5. C. On August 5, Air Compressors pays its account in full. Record the journal entries to recognize the initial purchase, the conversion plus cash, and the payment.