Z-Mart uses the perpetual inventory system and has its own credit card. Z-Mart charges a per-month interest fee for any unpaid balance on its store credit card at each month-end. Apr. 30 Z-Mart sold merchandise for $2,800 (that had cost $1,550) and accepted the customer's Z-Mart store credit card. May 31 Z-Mart recorded $3 of interest earned from its store credit card as of this month-end. Prepare journal entries to record the above credit card transactions of Z-Mart.

Z-Mart uses the perpetual inventory system and has its own credit card. Z-Mart charges a per-month interest fee for any unpaid balance on its store credit card at each month-end. Apr. 30 Z-Mart sold merchandise for $2,800 (that had cost $1,550) and accepted the customer's Z-Mart store credit card. May 31 Z-Mart recorded $3 of interest earned from its store credit card as of this month-end. Prepare journal entries to record the above credit card transactions of Z-Mart.

Accounting

27th Edition

ISBN:9781337272094

Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Chapter9: Receivables

Section: Chapter Questions

Problem 9.6BPR: Sales and notes receivable transactions The following were selected from among the transactions...

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Sales and notes receivable transactions The following were selected from among the transactions completed by Caldemeyer Co. during the current year. Caldemeyer sells and installs home and business security systems. Jan. 3. Loaned 18,000 cash to Trina Gelhaus, receiving a 90-day, 8% note. Feb. 10. Sold merchandise on account to Bradford Co., 24,000. The cost of goods sold was 14,400. I3. Sold merchandise on account to Dry Creek Co., 60,000. The cost of goods sold was 54,000. Mar. 12. Accepted a 60-day, 7% note for 24,000 from Bradford Co. on account. 14. Accepted a 60-day, 9% note for 60,000 from Dry Creek Co. on account. Apr. 3. Received the interest due from Trina Gelhaus and a new 120-day, 9% note as a renewal of the loan of January 3. (Record both the debit and the credit to the notes receivable account.) May 11. Received from Bradford Co. the amount due on the note of March 12. 13. Dry Creek Co. dishonored its note dated March 14. July 12. Received from Dry Creek Co. the amount owed on the dishonored note, plus interest for 60 days at 12% computed on the maturity value of the note. Aug. 1. Received from Trina Gelhaus the amount due on her note of April 3. Oct. 5. Sold merchandise on account, terms 2/10, n/30, to Halloran Co., 13,500. Record the sale net of the 2% discount. The cost of goods sold was 8,100. 15. Received from Halloran Co. the amount of the invoice of October 5, less 2% discount. Instructions Journalize the entries to record the transactions.
Sales and notes receivable transactions The following were selected from among the transactions completed by Caldemeyer Co. during the current year. Caldemeyer Co. sells and installs home and business security systems. Jan. 3. Loaned 18,000 cash to Trina Gelhaus, receiving a 90-day, 8 % note. Feb. 10. Sold merchandise on account to Bradford Co., 24, 000. The cost of the merchandise sold was 14,400. 13. Sold merchandise on account to Dry Creek Co., 60,000. The cost of merchandise sold was 54,000. Mar. 12. Accepted a 60-day, 7% note for 24,000 from Bradford Co. on account. 14. Accepted a 60-day, 9% note for 60,000 from Dry Creek Co. on account. Apr. 3. Received the interest due from Trina Gelhaus and a new 120-day, 9% note as a renewal of the loan of January 3. (Record both the debit and the credit to the notes receivable account.) May 11. Received from Bradford Co. the amount due on the note of March 12. 13. Dry Creek Co. dishonored its note dated March 14. July 12. Received from Dry Creek Co. the amount owed on the dishonored note, plus interest for 60 days at 12% computed on the maturity value of the note. Aug. 1. Received from Trina Gelhaus the amount due on her note of April 3. Oct. 5.Sold merchandise on account to Halloran Co. 13,500. The cost of the merchandise sold was 8, 100. 15 Received from Halloran Co. the amount of the invoice of October 5, less 2 % discount. Instructions Journalize the entries to record the transactions.
Sales and notes receivable transactions The following were selected from among the transactions completed during the current year by Danix Co., an appliance wholesale company: Jan. 21. Sold merchandise on account to Black Tie Co., 28,000. The cost of merchandise sold was 16,800. Mar. 18. Accepted a 60-day, 6% note for 28,000 from Black Tie Co. on account. May 17. Received from Black Tie Co. the amount due on the note of March 18. June 15. Sold merchandise on account to Pioneer Co. for 17,700. The cost of merchandise sold was 10,600. 21. Loaned 18,000 cash to JR Stutts, receiving a 30-day, 8% note. 25. Received from Pioneer Co. the amount due on the invoice of June 15. July 21. Received the interest due from JR Stutts and a new 60-day, 9% note as a renewal of the loan of June 21. (Record both the debit and the credit to the notes receivable account.) Sept. 19. Received from JR Stutts the amount due on her note of July 21. 22. Sold merchandise on account to Wycoff Co., 20,000. The cost of merchandise sold was 12,000. Oct. 14. Accepted a 30-day, 6% note for 20,000 from Wycoff Co. on account. Nov. 13. Wycoff Co. dishonored the note dated October 14. Dec. 28. Received from Wycoff Co. the amount owed on the dishonored note, plus interest for 45 days at 8% computed on the maturity value of the note. Instructions Journalize the entries to record the transactions.
Sales and notes receivable transactions The following were selected from among the transactions completed during the current year by Danix Co., an appliance wholesale company: Jan. 21. Sold merchandise on account to Black Tie Co., 28,000. The cost of goods sold was 16,800. Mar. 18. Accepted a 60-day, 6% note for 28,000 from Black Tie Co. on account. May. 17. Received from BlackTie Co. the amount due on the note of March 18. June. 15. Sold merchandise on account, terms 1/10, n/30, to Pioneer Co. for 17,700. Record the sale net of the discount. The cost of goods sold was 10,600. 21. Loaned 18,000 cash to JR Stutts, receiving a 30-day, 8% note. 25. Received from Pioneer Co. the amount due on the invoice of June 15, less 1% discount. July. 21. Received the interest due from JR Stutts and a new 60-day, 9% note as a renewal of the loan of June 21. (Record both the debit and the credit to the notes receivable account.) Sept. 19. Received from JR Stutts the amount due on her note of July 21. 22. Sold merchandise on account to Wycoff Co., 20,000. The cost of goods sold was 12,000. Oct. 14 Accepted a 30-day, 6% note for 20,000 from Wycoff Co. on account. Nov. 13. Wycoff Co. dishonored the note dated October 14. Dec. 28. Received from Wycoff Co. the amount owed on the dishonored note, plus interest for 45 days at 8% computed on the maturity value of the note. Instructions Journalize the entries to record the transactions.
( Appendix 5A) Sales Discounts Ramsden Inc. provided consulting services with a gross price of $25,000 and terms of 2/10, n/30. Required: 1. Prepare the necessary journal entries to record the sale under the gross method. 2. Prepare the necessary journal entries to record collection of the receivable, assuming the customer pays within 10 days. 3. Prepare the necessary journal entries to record collection of the receivable, assuming the customer pays after 10 days.
Appendix 1 Discount taken in next fiscal year Using the data for Sacajawea Mercantile Co. in Exercise 5-35, assume that Mark Bishop pays his June 30, 20Y4, account receivable of 1,500 on July 6, 20Y4, and takes a 2% sales discount. Journalize the entry to record the payment on account from Mark Bishop.
Sales and notes receivable transactions The following were selected from among the transactions completed during the current year by Danix Co., an appliance wholesale company: Jan. 21. Sold merchandise on account to Black Tie Co., 28,000. The cost of merchandise sold was 16,800. Mar. 18. Accepted a 60-day, 6% note for 28,000 from Black Tie Co. on account. May 17. Received from Black Tie Co. the amount due on the note of March 18. June 15. Sold merchandise on account to Pioneer Co. for 17,700. The cost of merchandise sold was 10,600. 21. Loaned 18,000 cash to JR Stutts, receiving a 30-day, 8% note. 25. Received from Pioneer Co. the amount due on the invoice of June 15, less 1% discount. July 21. Received the interest due from JR Stutts and a new 60-day, 9% note as a renewal of the loan of June 21. (Record both the debit and the credit to the notes receivable account.) Sept.19. Received from JR Stutts the amount due on her note of July 21. 22. Sold merchandise on account to Wycoff Co., 20,000. The cost of merchandise sold was 12,000. Oct. 14. Accepted a 30-day, 6% note for 20,000 from Wycoff Co. on account. Nov. 13. Wycoff Co. dishonored the note dated October 14. Dec. 28. Received from Wycoff Co. the amount owed on the dishonored note, plus interest for 45 days at 8% computed on the maturity value of the note. Instructions Journalize the entries to record the transactions.
Sales and notes receivable transactions The following were selected from among the transactions completed by Caldemeyer Co. during the current year. Caldemeyer sells and installs home and business security systems. Jan. 3. Loaned 18,000 cash to Trina Gelhaus, receiving a 90-day, 8% note. Feb. 10. Sold merchandise on account to Bradford Co., 24,000. The cost of goods sold was 14,400. I3. Sold merchandise on account to Dry Creek Co., 60,000. The cost of goods sold was 54,000. Mar. 12. Accepted a 60-day, 7% note for 24,000 from Bradford Co. on account. 14. Accepted a 60-day, 9% note for 60,000 from Dry Creek Co. on account. Apr. 3. Received the interest due from Trina Gelhaus and a new 120-day, 9% note as a renewal of the loan of January 3. (Record both the debit and the credit to the notes receivable account.) May 11. Received from Bradford Co. the amount due on the note of March 12. 13. Dry Creek Co. dishonored its note dated March 14. July 12. Received from Dry Creek Co. the amount owed on the dishonored note, plus interest for 60 days at 12% computed on the maturity value of the note. Aug. 1. Received from Trina Gelhaus the amount due on her note of April 3. Oct. 5. Sold merchandise on account, terms 2/10, n/30, to Halloran Co., 13,500. Record the sale net of the 2% discount. The cost of goods sold was 8,100. 15. Received from Halloran Co. the amount of the invoice of October 5, less 2% discount. Instructions Journalize the entries to record the transactions.
Monitoring of Receivables The Russ Fogler Company, a small manufacturer of cordless telephones, began operations on January 1. Its credit sales for the first 6 months of operations were as follows: Throughout this entire period, the firm’s credit customers maintained a constant payments pattern: 209b paid in the month of sale, 309b paid in the first month following the sale, and 509b paid in the second month following the sale. What was Fogler’s receivables balance at the end of March and at the end of June? Assume 90 days per calendar quarter. What were the average daily sales (ADS) and days sales outstanding (DSO) for the first quarter and for the second quarter? What were the cumulative ADS and DSO for the first half-year? Construct an aging schedule as of June 30. Use account ages of 0-30, 31-60, and 61-90 days. Construct the uncollected balances schedule for the second quarter as of June 30.
Discount taken in next fiscal year Using the data for Sacajawea Mercantile Co. in Exercise 5-35, assume that Mark Bishop pays his June 30, 20Y4, account receivable of 1,500 on July 6, 20Y4, and takes a 2% sales discount. Journalize the entry to record the payment on account from Mark Bishop.