Q2. Golf World sold merchandise to Mulligans for $10,000, offering terms of 1/15, n/30. Mulligans paid for the merchandise within the discount period. Both companies use perpetual inventory systems. Requirements a. Prepare journal entries in the accounting records of Golf World to account for this sale and the subsequent collection. Assume the original cost of the merchandise to Golf World had been $6,500. b. Prepare journal entries in the accounting records of Mulligans to account for the purchase and subsequent payment. Mulligans records purchases of merchandise at net cost. c. Assume that, because of a change in personnel, Mulligans failed to pay for this merchandise within the discount period. Prepare the journal entry in the accounting records of Mulligans to record payment after the discount period.

Q2. Golf World sold merchandise to Mulligans for $10,000, offering terms of 1/15, n/30. Mulligans paid for the merchandise within the discount period. Both companies use perpetual inventory systems. Requirements a. Prepare journal entries in the accounting records of Golf World to account for this sale and the subsequent collection. Assume the original cost of the merchandise to Golf World had been $6,500. b. Prepare journal entries in the accounting records of Mulligans to account for the purchase and subsequent payment. Mulligans records purchases of merchandise at net cost. c. Assume that, because of a change in personnel, Mulligans failed to pay for this merchandise within the discount period. Prepare the journal entry in the accounting records of Mulligans to record payment after the discount period.

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

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 9E

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