# Pianos Unlimited sells pianos to customers. The company contracts with a supplier who provides it with replacement piano keys. There is an agreement that Pianos Unlimited is not required to provide cash payment immediately, and instead will provide payment within thirty days of the invoice date. Additional information: • Pianos Unlimited purchases 400 piano keys for \$7 each on September 1, invoice date September 1, with discount terms 2/10, n/30. • Pianos Unlimited returns 150 piano keys (receiving a credit amount for the total purchase price per key of \$7 each) on September 8. • The company purchases an additional 230 keys for \$5 each on September 15, invoice date September 15, with no discount terms. • The company pays 50% of the total amount due to the supplier on September 24. What amount does Pianos Unlimited still owe to the supplier on September 30? What account is used to recognize this outstanding amount?

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### Principles of Accounting Volume 1

19th Edition
OpenStax
Publisher: OpenStax College
ISBN: 9781947172685

#### Solutions

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Section
FindFindarrow_forward

### Principles of Accounting Volume 1

19th Edition
OpenStax
Publisher: OpenStax College
ISBN: 9781947172685
Chapter 12, Problem 3EB
Textbook Problem
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## Pianos Unlimited sells pianos to customers. The company contracts with a supplier who provides it with replacement piano keys. There is an agreement that Pianos Unlimited is not required to provide cash payment immediately, and instead will provide payment within thirty days of the invoice date.Additional information:• Pianos Unlimited purchases 400 piano keys for \$7 each on September 1, invoice date September 1, with discount terms 2/10, n/30.• Pianos Unlimited returns 150 piano keys (receiving a credit amount for the total purchase price per key of \$7 each) on September 8.• The company purchases an additional 230 keys for \$5 each on September 15, invoice date September 15, with no discount terms.• The company pays 50% of the total amount due to the supplier on September 24.What amount does Pianos Unlimited still owe to the supplier on September 30? What account is used to recognize this outstanding amount?

To determine

Concept introduction:

Accounts Payable: When a company purchases material on credit from its supplier then that supplier is called accounts payable. Account payable is a liability for the company.

To calculate:

Amount due to supplies are its account title

### Explanation of Solution

 Accounts Payable A/c Particulars Amount Particulars Amount Purchases 2800 Purchase Return 1050 (400*7) (150*7)...

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