Required Information [The following information applies to the questions displayed below.] Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Allied (seller) products. May 3 Allied made its first and only purchase of inventory for the period on May 3 for 3,000 units at a price of $8 cash per unit (for a total cost of $24,000). May 5 Allied sold 1,500 of the units in inventory for $12 per unit (invoice total: $18,000) to Macy Company under credit terms 2/10, n/60. The goods cost Allied $12,000. May 7 Macy returns 158 units because they did not fit the customer's needs (invoice amount: $1,800). Allied restores the units, which cost $1,200, to its inventory. May 8 Macy discovers that 150 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $600 to compensate for the damage. Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount. May 15 se the above informations, analyze each transaction by indicating its effects on the income statement-specifically, identify the counts and amounts (including + or -) for each transaction.
Required Information [The following information applies to the questions displayed below.] Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Allied (seller) products. May 3 Allied made its first and only purchase of inventory for the period on May 3 for 3,000 units at a price of $8 cash per unit (for a total cost of $24,000). May 5 Allied sold 1,500 of the units in inventory for $12 per unit (invoice total: $18,000) to Macy Company under credit terms 2/10, n/60. The goods cost Allied $12,000. May 7 Macy returns 158 units because they did not fit the customer's needs (invoice amount: $1,800). Allied restores the units, which cost $1,200, to its inventory. May 8 Macy discovers that 150 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $600 to compensate for the damage. Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount. May 15 se the above informations, analyze each transaction by indicating its effects on the income statement-specifically, identify the counts and amounts (including + or -) for each transaction.
Chapter12: Current Liabilities
Section: Chapter Questions
Problem 3PB: Review the following transactions, and prepare any necessary journal entries for Sewing Masters Inc....
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figure out may 15 amount balance for gross profit and net sales
![Required Information
[The following information applies to the questions displayed below.]
Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Allied (seller) products.
May 3 Allied made its first and only purchase of inventory for the period on May 3 for 3,000 units at a price of $8
cash per unit (for a total cost of $24,000).
May 5
Allied sold 1,500 of the units in inventory for $12 per unit (invoice total: $18,000) to Macy Company under
credit terms 2/10, n/60. The goods cost Allied $12,000.
May 7
Macy returns 150 units because they did not fit the customer's needs (invoice amount: $1,800). Allied restores
the units, which cost $1,200, to its inventory.
May 8
Macy discovers that 150 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a
price reduction (allowance) and credits Macy's accounts receivable for $600 to compensate for the damage.
May 15
Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns,
allowances, and any cash discount.
Use the above informations, analyze each transaction by indicating its effects on the income statement-specifically, identify the
accounts and amounts (including + or -) for each transaction.
Income Statement Components
Sales
Sales discounts
Sales returns and allowances
Net sales
Cost of goods sold
Gross profit
May 3
Increase/Decrease
Amount
May 5
Increase/Decrease
(+) increase
(+) increase
(+) increase
(+) increase
Amount
18,000
May 7
Increase/Decrease
(+) increase
18,000 (-) decrease
12,000 (-) decrease
6,000 (-) decrease
Amount
May 8
Increase/Decrease
1,800 (+) increase
1,800 (-) decrease
1,200
600 (-) decrease
Amount
Increase/Decrease
(+) increase
600
600 (-) decrease
May 15
600 (-) decrease
Amount
312](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb05f9fea-9166-40ea-bb81-ee011a114a34%2F90135bcf-62f5-4a19-95b1-7b175f7f35f4%2Feygaat9_processed.png&w=3840&q=75)
Transcribed Image Text:Required Information
[The following information applies to the questions displayed below.]
Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Allied (seller) products.
May 3 Allied made its first and only purchase of inventory for the period on May 3 for 3,000 units at a price of $8
cash per unit (for a total cost of $24,000).
May 5
Allied sold 1,500 of the units in inventory for $12 per unit (invoice total: $18,000) to Macy Company under
credit terms 2/10, n/60. The goods cost Allied $12,000.
May 7
Macy returns 150 units because they did not fit the customer's needs (invoice amount: $1,800). Allied restores
the units, which cost $1,200, to its inventory.
May 8
Macy discovers that 150 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a
price reduction (allowance) and credits Macy's accounts receivable for $600 to compensate for the damage.
May 15
Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns,
allowances, and any cash discount.
Use the above informations, analyze each transaction by indicating its effects on the income statement-specifically, identify the
accounts and amounts (including + or -) for each transaction.
Income Statement Components
Sales
Sales discounts
Sales returns and allowances
Net sales
Cost of goods sold
Gross profit
May 3
Increase/Decrease
Amount
May 5
Increase/Decrease
(+) increase
(+) increase
(+) increase
(+) increase
Amount
18,000
May 7
Increase/Decrease
(+) increase
18,000 (-) decrease
12,000 (-) decrease
6,000 (-) decrease
Amount
May 8
Increase/Decrease
1,800 (+) increase
1,800 (-) decrease
1,200
600 (-) decrease
Amount
Increase/Decrease
(+) increase
600
600 (-) decrease
May 15
600 (-) decrease
Amount
312
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