Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 5, Problem 17E
Recording purchases, returns, and allowances periodic P5
Prepare
Apr. 2 Purchased $4,600 of merchandise from Lyon Company with credit terms of 2/15. n/60, invoice dated April 2, and FOB shipping point.
3. Paid $300 cash for shipping charges on the April 2 purchase.
4. Returned to Lyon Company unacceptable merchandise that had an invoice price of $600.
17. Sent a check to Lyon Company for the April 2 purchase, net of the discount and the returned merchandise.
18. Purchased $8,500 of merchandise from Frist Corp. with credit terms of 1/10, n/30, invoice dated April 18, and FOB destination.
21 After negotiations, received from Frist a $500 allowance toward the $8,500 owed on the April 18 purchase.
28 Sent check to Frist paying for the April 18 purchase, net of the allowance and the discount.
Refer to Exercise 5-3 and prepare journal entries to record each of the merchandising transactions assuming that the buyer uses the periodic inventory system and the gross method.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Chapter 5 Solutions
Principles of Financial Accounting.
Ch. 5 - Prob. 1MCQCh. 5 - Prob. 2MCQCh. 5 - Prob. 3MCQCh. 5 - Prob. 4MCQCh. 5 - A companys net sales are 675,000, its cost of...Ch. 5 - Prob. 1DQCh. 5 - In comparing the accounts of a merchandising...Ch. 5 - Prob. 3DQCh. 5 - Prob. 4DQCh. 5 - How does a company that uses a perpetual inventory...
Ch. 5 - Distinguish between cash discounts and trade...Ch. 5 - Prob. 7DQCh. 5 - Prob. 8DQCh. 5 - Prob. 9DQCh. 5 - What is the difference between the single-step and...Ch. 5 - APPLE Refer to the balance sheet and income...Ch. 5 - Prob. 12DQCh. 5 - Prob. 13DQCh. 5 - Prob. 14DQCh. 5 - Prob. 15DQCh. 5 - QUICK STUDY Applying merchandising terms C1 P1...Ch. 5 - Identifying inventory costs Costs of 5,000 were...Ch. 5 - Prob. 3QSCh. 5 - Question: Compute the amount to be paid for each...Ch. 5 - Recording purchases, returns, and discounts taken...Ch. 5 - Prob. 6QSCh. 5 - Prob. 7QSCh. 5 - Prob. 8QSCh. 5 - Accounting for shrinkageperpetual system P3 Nix'It...Ch. 5 - Closing entries P3 Refer to QS 4-9 and prepare...Ch. 5 - Prob. 11QSCh. 5 - Prob. 12QSCh. 5 - Prob. 13QSCh. 5 - Computing and interpreting acid-test ratio Use the...Ch. 5 - Prob. 15QSCh. 5 - Contrasting periodic and perpetual systems...Ch. 5 - Prob. 17QSCh. 5 - Prob. 18QSCh. 5 - Prob. 19QSCh. 5 - Prob. 20QSCh. 5 - Prob. 21QSCh. 5 - Prob. 22QSCh. 5 - Prob. 23QSCh. 5 - Prob. 1ECh. 5 - Prob. 2ECh. 5 - Prob. 3ECh. 5 - Prob. 4ECh. 5 - Recording purchases, purchases returns, and...Ch. 5 - Recording sales, purchases. and cash...Ch. 5 - Prob. 7ECh. 5 - Inventory and cost of sales transactions in...Ch. 5 - Prob. 9ECh. 5 - Prob. 10ECh. 5 - Prob. 11ECh. 5 - Impacts of inventory error on key accounts P3 A...Ch. 5 - Impacts of inventory error on key accounts P3 A...Ch. 5 - Prob. 14ECh. 5 - Prob. 15ECh. 5 - Prob. 16ECh. 5 - Recording purchases, returns, and allowances...Ch. 5 - Recording sales, purchases, and cash...Ch. 5 - Prob. 19ECh. 5 - Prob. 20ECh. 5 - Recording estimates of future returns P6 Chico...Ch. 5 - Prob. 22ECh. 5 - Recording sates, purchases. shipping. and...Ch. 5 - Recording purchases, sales, returns, and...Ch. 5 - Prob. 25ECh. 5 - Preparing journal entries for merchandising...Ch. 5 - Prob. 2APCh. 5 - Prob. 3APCh. 5 - Prob. 4APCh. 5 - Prob. 5APCh. 5 - Preparing journal entries for merchandising...Ch. 5 - Prob. 2BPCh. 5 - Prob. 3BPCh. 5 - Prob. 4BPCh. 5 - The following unadjusted trial balance is prepared...Ch. 5 - This serial problem began in Chapter 1 and...Ch. 5 - Prob. 1AACh. 5 - Prob. 2AACh. 5 - Prob. 3AACh. 5 - Prob. 1BTNCh. 5 - You are the financial officer for Music Plus, a...Ch. 5 - Prob. 3BTNCh. 5 - Prob. 5BTN
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- JOURNAL ENTRIESPERPETUAL INVENTORY Doreen Woods owns a small variety store. The following transactions took place during March of the current year. Journalize the transactions in a general journal using the perpetual inventory method. Mar. 3 Purchased merchandise on account from Corner Galleria, 3,500. 7 Paid freight charge on merchandise purchased, 200. 13 Sold merchandise on account to Sonya Specialties, 4,250. The cost of the merchandise was 2,550. 18 Received a credit memo from Corner Galleria for merchandise returned, 900. 22 Issued a credit memo to Sonya Specialties for merchandise returned, 500. The cost of the merchandise was 300.arrow_forwardPurchase Discounts For each of the following transactions of Buckeye Corporation, prepare the appropriate journal entry. (All purchases on credit are made with terms of 1/10, n/30, and Buckeye uses the periodic system of inventory.) July 3: Purchased merchandise on credit from Wildcat Corp. for $3,500. July 12: Paid amount owed to Wildcat Corp.arrow_forwardJOURNAL ENTRIESPERPETUAL INVENTORY Joan Ziemba owns a small variety store. The following transactions took place during March of the current year. Journalize the transactions in a general journal using the perpetual inventory method. Mar.3 Purchased merchandise on account from City Galleria, 2,900. 7 Paid freight charge on merchandise purchased, 225. 13 Sold merchandise on account to Amber Specialties, 3,400. The cost of the merchandise was 2,200. 18 Received a credit memo from City Galleria for merchandise returned, 650. 22 Issued a credit memo to Amber Specialties for merchandise returned, 600. The cost of the merchandise was 320.arrow_forward
- JOURNAL ENTRIESPERIODIC INVENTORY Paul Nasipak owns a business called Diamond Distributors. The following transactions took place during January of the current year. Journalize the transactions in a general journal using the periodic inventory method. Jan.5 Purchased merchandise on account from Prestigious Jewelers, 3,300. 8 Paid freight charge on merchandise purchased, 300. 12 Sold merchandise on account to Diamonds Unlimited, 4,500. 15 Received a credit memo from Prestigious Jewelers for merchandise returned, 700. 22 Issued a credit memo to Diamonds Unlimited for merchandise returned, 900.arrow_forwardJOURNAL ENTRIES UNDER THE PERPETUAL INVENTORY SYSTEM Sunita Computer Supplies entered into the following transactions. Prepare journal entries under the perpetual inventory system. May 1 Purchased merchandise on account from Anju Enterprises, 200,000. 8 Purchased merchandise for cash, 100,000. 15 Sold merchandise on account to Salils Pharmacy for 8,000. The merchandise cost 5,000.arrow_forwardJOURNALIZING PURCHASES RETURNS AND ALLOWANCES AND POSTING TO GENERAL LEDGER AND ACCOUNTS PAYABLE LEDGER Using page 3 of a general journal and the following general ledger and accounts payable ledger accounts, journalize and post the following transactions: July 7Returned merchandise to Starcraft Industries, 700. 15Returned merchandise to XYZ, Inc., 450. 27Returned merchandise to Datamagic, 900.arrow_forward
- PURCHASES TRANSACTIONS Ann Benton, owner of Bentons Galleria, made the following purchases of merchandise on account during the month of October: Oct. 2Purchase Invoice No. 321, 1,950, from Boggs Distributors. 7Purchase Invoice No. 152, 2,915, from Wolfs Wholesaler. 10Purchase Invoice No. 634, 3,565, from Komuro Co. 16Purchase Invoice No. 349, 2,845, from Fritz McCord, Inc. 24Purchase Invoice No. 587, 3,370, from Boggs Distributors. 26Purchase Invoice No. 764, 2,240, from Sanderson Company. 31Purchase Invoice No. 672, 1,630, from Wolfs Wholesaler. Required 1. Record the transactions starting with page 16 of a general journal. 2. Post from the general journal to the general ledger accounts and to the accounts payable ledger accounts. Use general ledger account numbers as shown in the chapter.arrow_forwardPURCHASES TRANSACTIONS J. B. Speck, owner of Specks Galleria, made the following purchases of merchandise on account during the month of September: Sept. 3Purchase Invoice No. 415, 2,650, from Smith Distributors. 8Purchase Invoice No. 132, 3,830, from Michaels Wholesaler. 11Purchase Invoice No. 614, 3,140, from J. B. Sanders Co. 18Purchase Invoice No. 329, 2,250, from Bateman Jones, Inc. Sept. 23Purchase Invoice No. 767, 4,160, from Smith Distributors. 27Purchase Invoice No. 744, 1,980, from Anderson Company. 30Purchase Invoice No. 652, 2,780, from Michaels Wholesaler. Required 1. Record the transactions starting with page 16 of a general journal. 2. Post from the general journal to the general ledger accounts and to the accounts payable ledger accounts. Use general ledger account numbers as shown in the chapter.arrow_forwardJournalize the following transactions in general journal form. a. Bought merchandise on account from Brewer, Inc., invoice no. B2997, 914; terms net 30 days; FOB destination. b. Received credit memo no. 96 from Brewer, Inc., for merchandise returned, 238.arrow_forward
- ADJUSTMENT FOR MERCHANDISE INVENTORY USING T ACCOUNTS: PERIODIC INVENTORY SYSTEM Sandra Owens owns a business called Sandras Sporting Goods. Her beginning inventory as of January 1, 20--, was 33,000, and her ending inventory as of December 31, 20--, was S36,000. Set up T accounts for Merchandise Inventory and Income Summary and perform the year-end adjustment for Merchandise Inventory.arrow_forwardADJUSTMENT FOR MERCHANDISE INVENTORY USING T ACCOUNTS: PERIODIC INVENTORY SYSTEM Matt Henry owns a business called Henrys Sporting Goods. His beginning inventory as of January 1, 20--, was 45,000, and his ending inventory as of December 31, 20--, was 57,000. Set up T accounts for Merchandise Inventory and Income Summary and perform the year-end adjustment for Merchandise Inventory.arrow_forwardPalisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2016 (unless otherwise indicated), are as follows: During May, the last month of the fiscal year, the following transactions were completed: May 1. Paid rent for May, 5,000. 3. Purchased merchandise on account from Martin Co., terms 2/10, n/30, FOB shipping point, 36,000. 4. Paid freight on purchase of May 3, 600. 6. Sold merchandise on account to Korman Co., terms 2/10, n/30, FOB shipping point, 68,500. The cost of the merchandise sold was 41,000. 7. Received 22,300 cash from Halstad Co. on account. 10. Sold merchandise for cash, 54,000. The cost of the merchandise sold was 32,000. 13. Paid for merchandise purchased on May 3. 15. Paid advertising expense for last half of May, 11,000. 16. Received cash from sale of May 6. 19. Purchased merchandise for cash, 18,700. 19. Paid 33,450 to Buttons Co. on account. 20. Paid Korman Co. a cash refund of 13,230 for returned merchandise from sale of May 6. The invoice amount of the returned merchandise was 13,500 and the cost of the returned merchandise was 8,000. Record the following transactions on Page 21 of the journal: 20. Sold merchandise on account to Crescent Co., terms 1/10, n/30, FOB shipping point, 110,000. The cost of the merchandise sold was 70,000. 21. For the convenience of Crescent Co., paid freight on sale of May 20, 2,300. 21. Received 42,900 cash from Gee Co. on account. May 21. Purchased merchandise on account from Osterman Co., terms 1/10, n/30, FOB destination, 88,000. 24. Returned of damaged merchandise purchased on May 21, receiving a credit memo from the seller for 5,000. 26. Refunded cash on sales made for cash, 7,500. The cost of the merchandise returned was 4,800. 28. Paid sales salaries of 56,000 and office salaries of 29, 000. 29. Purchased store supplies for cash, 2,400. 30. Sold merchandise on account to Turner Co., terms 2/10, n/30, FOB shipping point, 78,750. The cost of the merchandise sold was 47,000. 30. Received cash from sale of May 20 plus freight paid on May 21. 31. Paid for purchase of May 21, less return of May 24. Instructions 1. Enter the balances of each of the accounts in the appropriate balance column of a four-column account. Write Balance in the item section, and place a check mark () in the Posting Reference column. Journalize the transactions for July, starting on Page 20 of the journal. 2. Post the journal to the general ledger, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers. 3. Prepare an unadjusted trial balance. 4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete (5) and (6). f. The adjustment for customer returns and allowances is 60,000 for sales and 35,000 for cost of merchandise sold. 5. (Optional) Enter the unadjusted trial balance on a IO-column end-of-period spreadsheet (work sheet), and complete the spreadsheet. 6. Journalize and post the adjusting entries. Record the adjusting entries on Page 22 of the journal. 7. Prepare an adjusted trial balance. 8. Prepare an income statement, a statement of owners equity, and a balance sheet. 9. Prepare and post the closing entries. Record the closing entries on Page 23 of the journal. Indicate closed accounts by inserting a line in both the Balance columns opposite the closing entry. Insert the new balance in the owners capital account. 10. Prepare a post-closing trial balance.arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,
Century 21 Accounting Multicolumn JournalAccountingISBN:9781337679503Author:GilbertsonPublisher:Cengage
Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
College Accounting, Chapters 1-27 (New in Account...AccountingISBN:9781305666160Author:James A. Heintz, Robert W. ParryPublisher:Cengage Learning
College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:9781337679503
Author:Gilbertson
Publisher:Cengage
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
College Accounting, Chapters 1-27 (New in Account...
Accounting
ISBN:9781305666160
Author:James A. Heintz, Robert W. Parry
Publisher:Cengage Learning
IAS 29 Financial Reporting in Hyperinflationary Economies: Summary 2021; Author: Silvia of CPDbox;https://www.youtube.com/watch?v=55luVuTYLY8;License: Standard Youtube License