24 MONTH MYLAB (MAN)
7th Edition
ISBN: 9780136503521
Author: MILLER-NOBLES
Publisher: PEARSON
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Question
Chapter 5, Problem 5.2SE
1.
To determine
Introduction:
To record: The journal entries for purchase transactions.
2.
To determine
Introduction: Journal entry is the first step of accounting to recording day-to-day transactions that a business performs. It helps in further preparing financial statements at the end of the period to assess the financial position of the business.
The cost of inventory for Company T&M.
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Consider the following transactions for Funtime Gadgets:
May 6 Funtime Gadgets buys $137,200 worth of merchandise from Gadget Warehouse on account
with credit terms of 2/10, n/30.
May 12 Funtime Gadgets returns $13,200 of the merchandise to Gadget Warehouse due to damage
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May 17 Funtime Gadgets paid the amount due, less the return and discount.
Journalize the purchase transactions.
Date
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May 12
May 17
$
Description
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Finally, how much did the inventory cost Funtime Gadgets?
Consider the following transactions for RC Photo:
• September 2 RC Photo Shop sold $44,700 of camera equipment on account, credit terms 3/15,
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September 12 RC Photo Shop received a sales returns totaling $1,100 for damaged goods from the
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September 18 RC Photo Shop receives payment from the customer on the amount due, less the
return and discount.
Journalize the purchase transactions assuming RC Photo Shop uses the periodic inventory system.
Credit
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September 12
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Description
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Journalize the following merchandise transactions:a. Sold merchandise on account, $94,800 with terms 2/10, n/30. The cost of the merchandise sold was $56,900.b. Received payment less the discount.c. Issued a $500 credit memo for damaged merchandise. The customer agreed to keep the merchandise.
Chapter 5 Solutions
24 MONTH MYLAB (MAN)
Ch. 5 - Which account does a merchandiser use that a...Ch. 5 - The two main inventory accounting systems are the...Ch. 5 - The journal entry for the purchase of inventory on...Ch. 5 - JC Manufacturing purchase d inventory for 5,300...Ch. 5 - Prob. 5QCCh. 5 - Suppose Daves Discounts Merchandise Inventory...Ch. 5 - Which of the following accounts would be closed at...Ch. 5 - What is the order of the subtotals that appear on...Ch. 5 - Prob. 9QCCh. 5 - Prob. 10AQC
Ch. 5 - Prob. 11BQCCh. 5 - What is a merchandiser, and what is the name of...Ch. 5 - Prob. 2RQCh. 5 - Describe the operating cycle of a merchandiser.Ch. 5 - What is Cost of Goods Sold (COGS), and where is it...Ch. 5 - How is gross profit calculated, and what does it...Ch. 5 - What are the two types of inventory accounting...Ch. 5 - What is an invoice?Ch. 5 - What account is debited when recording a purchase...Ch. 5 - Prob. 9RQCh. 5 - What is a purchase return? How does a purchase...Ch. 5 - Prob. 11RQCh. 5 - How is the net cost of inventory calculated?Ch. 5 - What are the two journal entries involved when...Ch. 5 - Prob. 14RQCh. 5 - When granting a sales allowance, is there a return...Ch. 5 - Prob. 16RQCh. 5 - Prob. 17RQCh. 5 - Prob. 18RQCh. 5 - What are the four steps involved in the closing...Ch. 5 - Prob. 20RQCh. 5 - Prob. 21RQCh. 5 - Prob. 22RQCh. 5 - Prob. 23RQCh. 5 - Prob. 24ARQCh. 5 - Prob. 25BRQCh. 5 - Prob. 26BRQCh. 5 - Prob. 27BRQCh. 5 - Prob. 28BRQCh. 5 - Prob. 29BRQCh. 5 - Prob. 30BRQCh. 5 - Prob. 31BRQCh. 5 - Comparing periodic and perpetual inventory systems...Ch. 5 - Prob. 5.2SECh. 5 - Prob. 5.3SECh. 5 - Prob. 5.4SECh. 5 - Prob. 5.5SECh. 5 - Prob. 5.6SECh. 5 - Prob. 5.7SECh. 5 - Prob. 5.8SECh. 5 - Prob. 5.9SECh. 5 - Prob. 5.10SECh. 5 - Prob. 5.11SECh. 5 - Prob. 5.12SECh. 5 - Prob. 5.13SECh. 5 - Prob. 5.14SECh. 5 - Prob. 5.15SECh. 5 - Prob. 5.16SECh. 5 - Prob. 5.17SECh. 5 - Prob. 5.18SECh. 5 - Prob. 5.19SECh. 5 - For all exercises, assume the perpetual inventory...Ch. 5 - Journalizing purchase transactions from an invoice...Ch. 5 - Prob. 5.22ECh. 5 - Prob. 5.23ECh. 5 - Prob. 5.24ECh. 5 - Prob. 5.25ECh. 5 - Use the following information to answer Exercises...Ch. 5 - Prob. 5.27ECh. 5 - Prob. 5.29ECh. 5 - Prob. 5.30ECh. 5 - Prob. 5.31ECh. 5 - Prob. 5.32ECh. 5 - Prob. 5.33ECh. 5 - Prob. 5.34ECh. 5 - Prob. 5.35ECh. 5 - Prob. 5.36APCh. 5 - Prob. 5.37APCh. 5 - Prob. 5.38APCh. 5 - Prob. 5.39APCh. 5 - Prob. 5.40APCh. 5 - Prob. 5.41APCh. 5 - Prob. 5.42APCh. 5 - Prob. 5.43BPCh. 5 - Prob. 5.44BPCh. 5 - Prob. 5.45BPCh. 5 - Prob. 5.46BPCh. 5 - Prob. 5.47BPCh. 5 - Prob. 5.48BPCh. 5 - Prob. 5.49BPCh. 5 - Prob. 5.50CPCh. 5 - Prob. 5.51CPCh. 5 - Prob. 5.52PSCh. 5 - Prob. 5.1CTDCCh. 5 - Prob. 5.1CTEICh. 5 - Prob. 5.1CTFC
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- Journalize the following merchandise transactions: a. Sold merchandise on account, $94,800 with terms 2/10, n/30. The cost of the merchandise sold was $56,900. b. Received payment less the discount. c. Issued a $500 credit memo for damaged merchandise. The customer agreed to keep the merchandise.arrow_forwardS5-2 Journalizing purchase transactions Consider the following transactions for Toys and More: May 8 Toys and More buys $113,300 worth of MegoBlock toys on account with credit terms of 2/10, n/60. Toys and More returns $11,250 of the merchandise to MegoBlock due to damage during shipment. 12 15 Toys and More paid the amount due, less the return and discount. Requirements 1. Journalize the purchase transactions. Explanations are not required. 2. In the final analysis, how much did the inventory cost Toys and More?arrow_forwardPurchases Transactions Barans Company purchased merchandise on account from a supplier for $9,200, terms 2/10, n/30. Barans Company returned $1,700 of the merchandise and received full credit. a. If Barans Company pays the invoice within the discount period, what is the amount of cash required for the payment? b. What account is credited by Barans Company to record the return? Merchandise Inventory Feedback Check My Work (a) The return of merchandise reduces the original invoice amount to be paid. The discount is taken on the amount owed on the merchandise after the return. (b) Any discounts or returns are recorded directly by the buyer who reduces the balances of Accounts Payable and Merchandise Inventory, using a debit memo based on the net cost of the merchandise. 9:04 P 10/20/2 %23 近arrow_forward
- Consider the following transactions for BigGuy Toys: Apr. 7 BigGuy Toys purchased $198,800 worth of MegoBlock toys on account with credit terms of 2/10, n/60. Apr. 13 BigGuy Toys returned $19,800 of the merchandise to MegoBlock due to damage during shipment. Apr. 15 BigGuy Toys paid the amount due, less the return and discount. Requirements 1. Journalize the purchase transactions. Explanations are not required. 2. In the final analysis, how much did the inventory cost BigGuy Toys? Requirement 1. Journalize the purchase transactions. Explanations are not required. (Assume the company uses a perpetual inventory system. Record debits first, then credits. Exclude explanations from journal entries.) Apr. 7: BigGuy Toys purchased $198,800 worth of MegoBlock toys on account with credit terms of 2/10, n/60. Date Accounts Debit Credit Apr. 7…arrow_forwardReview the following situations and record any necessary journal entries for Letter Depot. Mar. 9 Letter Depot purchases $11,480 worth of merchandise on credit from a manufacturer. Shipping charges are an extra $460 cash. Terms of the purchase are 2/10, n/40, FOB Destination, invoice dated March 9. Mar. 20 Letter Depot sells $7,500 worth of merchandise to a customer who pays on credit. The merchandise has a cost to Letter Depot of $2,850. Shipping charges are an extra $420 cash. Terms of the sale are 3/15, n/50, FOB Destination, invoice dated March 20. If an amount box does not require an entry, leave it blank. Assume the perpetual inventory system is used.arrow_forwardReview the following situations and record any necessary journal entries for Letter Depot. Mar. 9 Letter Depot purchases $11,490 worth of merchandise on credit from a manufacturer. Shipping charges are an extra $460 cash. Terms of the purchase are 2/10, n/40, FOB Destination, invoice dated March 9. Mar. 20 Letter Depot sells $7,540 worth of merchandise to a customer who pays on credit. The merchandise has a cost to Letter Depot of $2,830. Shipping charges are an extra $420 cash. Terms of the sale are 3/15, n/50, FOB Destination, invoice dated March 20. If an amount box does not require an entry, leave it blank. Assume the perpetual inventory system is used. Mar. 9 Mar. 20 Sale on credit Mar. 20 Cost of sale Mar. 20 Shipping chargesarrow_forward
- Presented below are transactions related to Crane, Inc. May 10 (a) Purchased goods billed at $15,800 subject to cash discount terms of 2/10, r/60. Purchased goods billed at $13,800 subject to terms of 1/15, n/30. Paid invoice of May 10. Purchased goods billed at $10,300 subject to cash discount terms of 2/10, r/30. Your answer is partially correct. Prepare general journal entries for the transactions above under the assumption that purchases are to be recorded at net amounts after cash discounts and that discounts lost are to be treated as financial expense. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation Accounts Payable Inventory Accounts Payable Debit 15800 13800 Credit 10arrow_forwardPrepare the Journal Entries for the following purchase transactions: I. Purchase of merchandise for cash:a. Merchandise is purchased for cash, P35,000b. Merchandise listed at P50,000, subject to a trade discount of 10%, is purchased for cash. II. Purchase of merchandise on account:a. Merchandise purchased on account, credit terms 2/10, n/30, P40,000.b. Merchandise purchased on account, credit terms 3/10, n/30, P28,000.c. Payment is made on invoice (a) within the discount period.d, Payment is made on invoice (b) beyond the discount period.arrow_forwardSales transactionsJournalize the following merchandise transactions:a. Sold merchandise on account, $18,000 with terms 1/10, n/30. The cost of the goods sold was $10,800.b. Received payment less the discount.c. Refunded $600 to customer for defective merchandise that was not returned.arrow_forward
- Details of a purchase invoice and related credit memo are summarized as follows: Invoice: Cost of merchandise listed on purchase invoice $6,500 Prepaid freight charge added to invoice 150 Terms, FOB shipping point, 1/10, n/eom $1,500 Credit memo: Cost of merchandise returned Assume that the credit memo was received prior to payment and that the invoice is paid within the discount period. Determine the following: (a) Amount of the cash discount allowed. (b) Amount to be paid by the purchaser if the discount is taken. (c) Cost of the merchandise to the purchaser if the discount is NOT taken.arrow_forwardJournalize the following merchandise transactions: A. Sold merchandise on account, $21,300 with terms 2/10, net 30. The cost of the merchandise sold was $17,000. B. Received payment less the discount. C. merchandise on account from a supplier for $6,500, terms 2/10, net 30. D. Returned $1,500 of the merchandise and received full credit. E. Paid for the merchandise within the discount periodarrow_forwardJournalize the following transactions for the buyer, Martin Company, using the net method to account for purchase discounts. Assume a perpetual inventory system. January 6 Purchased goods from Goldmark Company on account, $10,000, terms 4/10, n/30. January 12 Returned defective merchandise to Goldmark Company that was previously purchased on account, $2,000. January 16 Paid the amount due to Goldmark Company. Date Account Title Debit Credit X 3 ?arrow_forward
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