On June 3, 2022, Marigold Company sold to Ann Mount merchandise having a sales price of $7,600 (cost $6,840) with terms of n/60, fo.b. shipping point. Marigold estimates that merchandise with a sales value of $760 will be returned. An invoice totaling $100 was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 8, Mount returned to Marigold $300 of merchandise containing flaws. Marigold expects the returned items to be resold at a profit. The freight on the returned merchandise was $22, paid by Marigold on June 8. On July 16, the company received a check for the balance due from Mount. No further returns are expected. Prepare journal entries for Marigold Company to record all the events in June and July. (Credit account titles are automatically indented when 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)

On June 3, 2022, Marigold Company sold to Ann Mount merchandise having a sales price of $7,600 (cost $6,840) with terms of n/60, fo.b. shipping point. Marigold estimates that merchandise with a sales value of $760 will be returned. An invoice totaling $100 was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 8, Mount returned to Marigold $300 of merchandise containing flaws. Marigold expects the returned items to be resold at a profit. The freight on the returned merchandise was $22, paid by Marigold on June 8. On July 16, the company received a check for the balance due from Mount. No further returns are expected. Prepare journal entries for Marigold Company to record all the events in June and July. (Credit account titles are automatically indented when 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)

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 14E: On January 5, 2019, ShoeKing Corp. sells for cash 500 pairs of volleyball shoes to FootAction, a...

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Heller Company began operations in 2019 and used the LIFO method to compute its 300,000 cost of goods sold for that year. At the beginning of 2020, Heller changed to the FIFO method. Heller determined that its cost of goods sold under FIFO would have been 250,000 in 2019. For 2020, Hellers cost of goods sold under FIFO was 360,000, while it would have been 410,000 under LIFO. Heller is subject to a 21% income tax rate. Compute the cumulative effect of the retrospective adjustment on prior years income (net of taxes) that Heller would report on its retained earnings statement for 2020.
Mark Industries issues a note in the amount of $45,000 on August 1, 2018 in exchange for the sale of merchandise. Which of the following is the correct journal entry for this sale? A. B. C. D.
Shaquille Corporation began the current year with inventory of 50,000. During the year, its purchases totaled 110,000. Shaquille paid freight charges of 8,500 for those purchases. At the end of the year, Shaquille had inventory of 47,800. Prepare a schedule to determine Shaquille's cost of goods sold for the current year.
On January 5, 2019, ShoeKing Corp. sells for cash 500 pairs of volleyball shoes to FootAction, a shoe retailer, for 70 each. FootAction has the right to return the shoes for any reason up to March 31, 2019, for a full refund. The cost of each pair of shoes is 32. ShoeKing predicts that it is probable that 40 pairs of the shoes will be returned. ShoeKing uses the perpetual method for inventory. Required: 1. Prepare ShoeKings journal entry on January 5, 2019, to account for this transaction. 2. Assume that FootAction returns 35 pairs of shoes on March 31, 2019. Prepare the journal entry to record this return.
Company Elmira reported the following cost of goods sold but later realized that an error had been made in ending inventory for year 2021. The correct inventory amount for 2021 was 32,000. Once the error is corrected, (a) how much is the restated cost of goods sold for 2021? and (b) how much is the restated cost of goods sold for 2022?
Refer to RE22-2. Assume Heller Company had sales revenue of 510,000 in 2019 and 650,000 in 2020. Prepare Hellers partial income statements (through gross profit) for 2019 and 2020. RE22-2 Heller Company began operations in 2019 and used the LIFO method to compute its 300,000 cost of goods sold for that year. At the beginning of 2020, Heller changed to the FIFO method. Heller determined that its cost of goods sold under FIFO would have been 250,000 in 2019. For 2020, Hellers cost of goods sold under FIFO was 360,000, while it would have been 410,000 under LIFO. Heller is subject to a 21% income tax rate. Compute the cumulative effect of the retrospective adjustment on prior years income (net of taxes) that Heller would report on its retained earnings statement for 2020.
Allen Company is a wholesale distributor of automotive replacement parts. Initial amounts taken from Allens accounting records are as follows: Accounts payable at December 31, 2019: Additional information is as follows: 1. Parts held on consignment from Charlie to Allen, the consignee, amounting to 155,000 were included in the physical count of goods in Allens warehouse on December 31, 2019, and in accounts payable at December 31, 2019. 2. 22,000 of parts, which were purchased from Full and paid for in December 2019, were sold in the last week of 2019 and appropriately recorded as sales of 28,000. The parts were included in the physical count of goods in Allens warehouse on December 31, 2019, because the parts were on the loading dock waiting to be picked up by customers. 3. Parts in transit to customers on December 31, 2019, shipped FOB shipping point on December 28, 2019, amounted to 34,000. The customers received the parts on January 7, 2020. Sales of 40,000 to the customers for the parts were recorded by Allen on January 3, 2020. 4. Retailers were holding 210,000 at cost (250,000 at retail) of goods on consignment from Allen, the consignor, at their stores on December 31, 2019. 5. Goods were in transit from Greg to Allen on December 31, 2019. The cost of the goods was 25,000, and they were shipped FOB shipping point on December 29, 2019. 6. A quarterly freight bill in the amount of 2,000 specifically relating to merchandise purchases in December 2019, all of which was still in the inventory at December 31, 2019, was received on January 4, 2020. The freight bill was not included in either the inventory or in accounts payable at December 31, 2019. 7. All of the purchases from Baker occurred during the last 7 days of the year. These items have been recorded in accounts payable and accounted for in the physical inventory at cost before discount. Allens policy is to pay invoices in time to take advantage of all cash discounts, adjust inventory accordingly, and record accounts payable, net of cash discounts. Required: Prepare a schedule of adjustments to the initial amounts of inventory, accounts payable, and sales. Show the effect, if any, of each of the transactions separately and indicate if the transactions would have no effect on the amount.
In 2020, HP Company transferred goods to a retailer on consignment. The goods cost P450,000 and normally are sold at a 40% markup on cost. GGG paid P5,000 for the cost of the shipment while the retailer paid P3,800 for advertising and P2,800 for the cost of freight out. The parties agreed that GGG would reimburse the cost of advertising and freight paid by the retailer. In 2020, the retailer at the normal markup, sold 80% of the merchandise and the balance of the merchandise was returned to AAA and paid a freight of P2,500. The retailer withheld 15% commission from payment plus the amount reimbursable by the consignor. How much is the consignment net income?
On November 1, 2021, FDN Trading sold merchandise to ABC Trading worth P43,000 with credit term of 1/10, n/30 under freight term FOB Destination. The cost of the freight of P1,200 was paid by FDN. On November 3, ABC Trading returned some defective merchandise worth P4,300 and on the following day, made a partial payment of P14,000. How much is the final amount collected by FDN Trading assuming that collection is made within the discount period?
On May 11, 2023, Wilson Purchasing purchased $24,000 of merchandise from Happy Sales; terms 3/10, n/90, FOB Happy Sales. The cost of the goods to Happy was $19,000. Wilson paid $1,400 to Express Shipping Service for the delivery charges on the merchandise on May 11. On May 12, Wilson returned $3,800 of goods to Happy Sales, which restored them to inventory. The returned goods had cost Happy $3,000. On May 20, Wilson mailed a cheque to Happy for the amount
On July 2, 2022, Honesty Co. consigned 3,200 books costing P60 and retailing for P100 each to Integrity Co. Freight cost paid by Honesty Co. amounted to P3,200. On September 30, 2021, Honesty Co. received from Integrity Co. the amount of ₱127,620 in full settlement of the balance due. The consignee deducted a commission of ₱20 for each book sold, ₱180 for delivery expenses and ₱200 for advertising expense.How many books were actually sold by Integrity Co.? (No peso sign on the answer)