Required information [The following information applies to the questions displayed below.] The transactions listed below are typical of those involving Southern Sporting Goods (SSG) and Sports R Us (SRU). SSG is a wholesale merchandiser and SRU is a retail merchandiser. Assume all sales of merchandise from SSG to SRU are made with terms n/30, and the two companies use perpetual inventory systems. Assume the following transactions between the two companies occurred in the order listed during the year ended December 31. of 2 a. SSG sold merchandise to SRU at a selling price of $125,000. The merchandise had cost SSG $94,000. b. Two days later, SRU complained to SSG that some of the merchandise differed from what SRU had ordered. SSG agreed to give an allowance of $3,000 to SRU. SRU also returned some sporting goods, which had cost SSG $12,000 and had been sold to SRU for $16,500. C. Just three days later SRU paid SSG, which settled all amounts owed. Book Print Required: 1. For each of the events (a) through (c), indicate the amount and direction of the effect on SSG in terms of the following items. (Enter any decreases to account balances with a minus sign.) ferences Sales Revenue Sales Returns Sales Allowances Transaction Cost of Goods Sold Net Sales Gross Profit a. 125,000 125,000 94,000 31,000 b. C.
Required information [The following information applies to the questions displayed below.] The transactions listed below are typical of those involving Southern Sporting Goods (SSG) and Sports R Us (SRU). SSG is a wholesale merchandiser and SRU is a retail merchandiser. Assume all sales of merchandise from SSG to SRU are made with terms n/30, and the two companies use perpetual inventory systems. Assume the following transactions between the two companies occurred in the order listed during the year ended December 31. of 2 a. SSG sold merchandise to SRU at a selling price of $125,000. The merchandise had cost SSG $94,000. b. Two days later, SRU complained to SSG that some of the merchandise differed from what SRU had ordered. SSG agreed to give an allowance of $3,000 to SRU. SRU also returned some sporting goods, which had cost SSG $12,000 and had been sold to SRU for $16,500. C. Just three days later SRU paid SSG, which settled all amounts owed. Book Print Required: 1. For each of the events (a) through (c), indicate the amount and direction of the effect on SSG in terms of the following items. (Enter any decreases to account balances with a minus sign.) ferences Sales Revenue Sales Returns Sales Allowances Transaction Cost of Goods Sold Net Sales Gross Profit a. 125,000 125,000 94,000 31,000 b. C.
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
Chapter8: Inventories: Special Valuation Issues
Section: Chapter Questions
Problem 13E: Retail Inventory Method The following information relates to the retail inventory method used by...
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Required information
[The following information applies to the questions displayed below.]
The transactions listed below are typical of those involving Southern Sporting Goods (SSG) and Sports R Us (SRU). SSG is
a wholesale merchandiser and SRU is a retail merchandiser. Assume all sales of merchandise from SSG to SRU are made
with terms n/30, and the two companies use perpetual inventory systems. Assume the following transactions between the
two companies occurred in the order listed during the year ended December 31.
of 2
a. SSG sold merchandise to SRU at a selling price of $125,000. The merchandise had cost SSG $94,000.
b. Two days later, SRU complained to SSG that some of the merchandise differed from what SRU had ordered. SSG
agreed to give an allowance of $3,000 to SRU. SRU also returned some sporting goods, which had cost SSG $12,000
and had been sold to SRU for $16,500.
C. Just three days later SRU paid SSG, which settled all amounts owed.
Book
Print
Required:
1. For each of the events (a) through (c), indicate the amount and direction of the effect on SSG in terms of the following items. (Enter
any decreases to account balances with a minus sign.)
ferences
Sales
Revenue
Sales
Returns
Sales
Allowances
Cost of
Goods Sold
Transaction
Net Sales
Gross Profit
125,000
125,000
a.
94,000
31,000
b.
C.
MC
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Hill
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Required information
[The following information applies to the questions displayed below.]
The transactions listed below are typical of those involving Southern Sporting Goods (SSG) and Sports R Us (SRU). SSG is
a wholesale merchandiser and SRU is a retail merchandiser. Assume all sales of merchandise from SSG to SRU are made
with terms n/30, and the two companies use perpetual inventory systems. Assume the following transactions between the
two companies occurred in the order listed during the year ended December 31.
of 2
a. SSG sold merchandise to SRU at a selling price of $125,000. The merchandise had cost SSG $94,000.
b. Two days later, SRU complained to SSG that some of the merchandise differed from what SRU had ordered. SSG
agreed to give an allowance of $3,000 to SRU. SRU also returned some sporting goods, which had cost SSG $12,000
and had been sold to SRU for $16,500.
C. Just three days later SRU paid SSG, which settled all amounts owed.
Book
Print
Required:
1. For each of the events (a) through (c), indicate the amount and direction of the effect on SSG in terms of the following items. (Enter
any decreases to account balances with a minus sign.)
ferences
Sales
Revenue
Sales
Returns
Sales
Allowances
Cost of
Goods Sold
Transaction
Net Sales
Gross Profit
125,000
125,000
a.
94,000
31,000
b.
C.
MC
Graw
Hill
Education
< Prev
3
4.
of 6
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21
Expert Solution
Step 1
Every time when a product is sold, Sales account is credited. Cost of these sold goods will be recorded in cost of goods sold account. All sales returns and sales allowances are entered into sales return and sales allowances account.
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