Newman Hardware Store completed the following transactions in December 2019. It uses perpetual inventory system. It records both purchase and sales at gross amount. Purchased goods from Jerry Wholesale for $4,200 with the terms of 2/15, 1 Dec n/30. Sold goods on account to Mack Ltd at $2,100, terms 1/20, n/30. The cost of goods sold was $1,300. Returned the defective goods costing $300 purchased on 1 December to Jerry Wholesale. Paid the outstanding amount owed to Jerry Wholesale in full. Mack Ltd returned the unsatisfactory goods from the 2 December sales. The selling price was $400 and the cost of the goods was $180. Paid $200 for transportation fee, of which half is for 2 December sale and the remaining for 1 December purchase. Received collections in full, from the customers billed on 2 December. 14 15 16 21 Purchased goods from Jerry Wholesale for $8,400 with the terms of 2/15, n/30, FOB Destination Point, with goods shipped on the same day and received on 3 January 2020. Found inventory shortfall of $200 in the month-end physical count. 30 31 Required a) Prepare the journal entries to record the above transactions. Will your journal entries on 30 December be different if the purchase made on 31 December b) had FOB Shipping point terms? Explain. If yes, show the entries.
Newman Hardware Store completed the following transactions in December 2019. It uses perpetual inventory system. It records both purchase and sales at gross amount. Purchased goods from Jerry Wholesale for $4,200 with the terms of 2/15, 1 Dec n/30. Sold goods on account to Mack Ltd at $2,100, terms 1/20, n/30. The cost of goods sold was $1,300. Returned the defective goods costing $300 purchased on 1 December to Jerry Wholesale. Paid the outstanding amount owed to Jerry Wholesale in full. Mack Ltd returned the unsatisfactory goods from the 2 December sales. The selling price was $400 and the cost of the goods was $180. Paid $200 for transportation fee, of which half is for 2 December sale and the remaining for 1 December purchase. Received collections in full, from the customers billed on 2 December. 14 15 16 21 Purchased goods from Jerry Wholesale for $8,400 with the terms of 2/15, n/30, FOB Destination Point, with goods shipped on the same day and received on 3 January 2020. Found inventory shortfall of $200 in the month-end physical count. 30 31 Required a) Prepare the journal entries to record the above transactions. Will your journal entries on 30 December be different if the purchase made on 31 December b) had FOB Shipping point terms? Explain. If yes, show the entries.
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter6: Accounting For Merchandising Businesses
Section: Chapter Questions
Problem 9PA: On December 31, 2019, the balances of the accounts appearing in the ledger of Wyman Company are as...
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 3 images
Recommended textbooks for you
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,