Record the following purchase transactions of Money Office Supplies. Aug. 3 Purchased 30 chairs on credit, at a cost of $60 per chair. Shipping charges are an extra $5 cash per chair and are not subject to discount. Terms of the purchase are 4/10, n/60, FOB Shipping Point, invoice dated August 3. Aug. 7 Purchased 22 chairs with cash, at a cost of $50 per chair. Shipping charges are an extra $3.50 cash per chair and are not subject to discount. Terms of the purchase are FOB Destination. Aug. 12 Money Office Supplies pays in full for their purchase on August 3. If an amount box does not require an entry, leave it blank. Assume the perpetual inventory system is used. Aug. 3 Purchase Merchandise Inventory Merchandise Inventory Accounts Payable Accounts Payable Aug. 3 Shipping charges Merchandise Inventory Merchandise Inventory Cash Cash Aug. 7 Purchase with cash Merchandise Inventory Merchandise Inventory Cash Cash Aug. 12 Payment Accounts Payable Accounts Payable Cash Cash Merchandise Inventory Merchandise Inventory

Record the following purchase transactions of Money Office Supplies. Aug. 3 Purchased 30 chairs on credit, at a cost of $60 per chair. Shipping charges are an extra $5 cash per chair and are not subject to discount. Terms of the purchase are 4/10, n/60, FOB Shipping Point, invoice dated August 3. Aug. 7 Purchased 22 chairs with cash, at a cost of $50 per chair. Shipping charges are an extra $3.50 cash per chair and are not subject to discount. Terms of the purchase are FOB Destination. Aug. 12 Money Office Supplies pays in full for their purchase on August 3. If an amount box does not require an entry, leave it blank. Assume the perpetual inventory system is used. Aug. 3 Purchase Merchandise Inventory Merchandise Inventory Accounts Payable Accounts Payable Aug. 3 Shipping charges Merchandise Inventory Merchandise Inventory Cash Cash Aug. 7 Purchase with cash Merchandise Inventory Merchandise Inventory Cash Cash Aug. 12 Payment Accounts Payable Accounts Payable Cash Cash Merchandise Inventory Merchandise Inventory

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter6: Merchandising Transactions

Section: Chapter Questions

Problem 1PA: Record journal entries for the following transactions of Furniture Warehouse. A. Aug. 3: Sold 15...

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Record journal entries for the following transactions of Mason Suppliers. A. Sep. 8: Purchased 50 deluxe hammers at a cost of $95 each from a manufacturer. Credit terms are 5/20, n/60, invoice date September 8. B. Sep. 12: Mason Suppliers returned 8 hammers for a full refund. C. Sep. 16: Mason Suppliers found 4 defective hammers, but kept the merchandise for an allowance of $250. D. Sep. 28: Mason Suppliers paid their account in full with cash.
Record journal entries for the following transactions of Furniture Warehouse. A. Aug. 3: Sold 15 couches at $500 each to a customer, credit terms 2/15, n/30, invoice date August 3; the couches cost Furniture Warehouse $150 each. B. Aug. 8: Customer returned 2 couches for a full refund. The merchandise was in sellable condition at the original cost. C. Aug. 15: Customer found 4 defective couches but kept the merchandise for an allowance of $1,000. D. Aug. 18: Customer paid their account in full with cash.
Record journal entries for the following purchase transactions of Flower Company. A. On October 13, Flower Company purchased 85 bushels of flowers with cash for $1,300. B. On October 20, Flower Company purchased 240 bushels of flowers for $20 per bushel on credit. Terms of the purchase were 5/10, n/30, invoice dated October 20. C. On October 30, Flower Company paid its account in full for the October 20 purchase.
Record the following purchase transactions of Money Office Supplies. Aug. 3 Purchased 40 chairs on credit, at a cost of $60 per chair. Shipping charges are an extra $3 cash per chair and are not subject to discount. Terms of the purchase are 4/10, n/60, FOB Shipping Point, invoice dated August 3. Aug. 7 Purchased 25 chairs with cash, at a cost of $50 per chair. Shipping charges are an extra $4.00 cash per chair and are not subject to discount. Terms of the purchase are FOB Destination. Aug. 12 Money Office Supplies pays in full for their purchase on August 3. If an amount box does not require an entry, leave it blank. Assume the perpetual inventory system is used. Aug. 3 Purchase Aug. 3 Shipping charges Aug. 7 Purchase with cash Aug. 12 Payment
Record the following sales transactions of Money Office Supplies. Apr. 4 Made a cash sale to a customer for 15 chairs at a sales price of $80 per chair. The cost to Money Office Supplies is $55 per chair. Shipping charges are an extra $4 cash per chair and are not subject to discount. Terms of the sale are FOB Shipping Point. Apr. 9 Sold 20 chairs on credit for $85 per chair to a customer. The cost per chair to Money Office Supplies is $50 per chair. Shipping charges are an extra $4.50 cash per chair and are not subject to discount. Terms of the sale are 3/10, n/30, FOB Destination, invoice dated April 9. Apr. 19 The customer pays in full for their purchase on April 9.
Record journal entries for the following transactions of Furniture Warehouse. Aug. 3: Sold 15 couches at $500 each to a customer, credit terms 2/15, n/30, invoice date August 3; the couches cost Furniture Warehouse $150 each. Aug. 8: Customer returned 2 couches for a full refund. The merchandise was in sellable condition at the original cost. Aug. 15: Customer found 4 defective couches but kept the merchandise for an allowance of $1,000. Aug. 18: Customer paid their account in full with cash. Solution Date Accounts and Explanation Debit Credit
Payment dates On March 25, the following invoices were issued for a $500 purchase on credit. Indicate the meaning of each credit term. 2/10, net 30 date of invoice b. 2/10, net 40 EOM c. 2/10, net 20 EOM d. 2/10, net 60 date of invoice Cost of giving up cash discounts Determine the cost of giving up the cash discount under each of the following terms of sale. (Note: Assume a 365-day year.) 2/10 net 30 b. 1/10 net 30 c. 1/10 net 45 d. 3/10 net 90 e. 1/10 net 60 f. 3/10 net 30 g. 4/10 net 180
Review 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.
Review 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 charges
Review the following situations and record any necessary journal entries for Lumber Farm Feb. 13 Lumber Farm purchases $9,650 worth of merchandise with cash from a manufacturer. Shipping charges are an extra $210 cash. Terms of the purchase are FOB Destination. Feb. 19 Lumber Farm sells $5,670 worth of merchandise to a customer who pays with cash. The merchandise has a cost to Lumber Farm of $2,200. Shipping charges are an extra $230 cash. Terms of the sale are FOB Destination.
1. Record journal entries for the following transactions of Furniture Warehouse. A. Aug. 3: Sold 15 couches at $114 each to a customer, credit terms 4/15, n/30, invoice date August 3; the couches cost Furniture Warehouse $14 each. B. Aug. 8: Customer returned 2 couches for a full refund. The merchandise was in sellable condition at the original cost. C. Aug. 18: Customer paid their account in full with cash.
2. Review the following transactions for Birdy Birdhouses and record any required journal entries. Sep. 6 Sep. 8 Birdy Birdhouses purchases 55 birdhouses at $14 each with cash. Birdy Birdhouses purchases 80 birdhouses at $19 each on credit. Terms of the purchase are 4/10, n/30, invoice date September 8. Birdy discovers 12 of the birdhouses are damaged from the Sep. 6 purchase and returns them to the supplier for a full refund. Birdy also discovers that 8 of the birdhouses from the Sep. 8 purchase are painted the wrong color but keeps them since the supplier granted an allowance of $20 per birdhouse. Birdy pays their account in full from the September 8 purchase, less any returns, allowances, and/or discounts. Sep. 10 Sep. 18

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Aug. 3	Purchased 30 chairs on credit, at a cost of $60 per chair. Shipping charges are an extra $5 cash per chair and are not subject to discount. Terms of the purchase are 4/10, n/60, FOB Shipping Point, invoice dated August 3.
Aug. 7	Purchased 22 chairs with cash, at a cost of $50 per chair. Shipping charges are an extra $3.50 cash per chair and are not subject to discount. Terms of the purchase are FOB Destination.
Aug. 12	Money Office Supplies pays in full for their purchase on August 3.

Aug. 3 Purchase	Merchandise Inventory	Merchandise Inventory
	Accounts Payable	Accounts Payable
Aug. 3 Shipping charges	Merchandise Inventory	Merchandise Inventory
	Cash	Cash
Aug. 7 Purchase with cash	Merchandise Inventory	Merchandise Inventory
	Cash	Cash
Aug. 12 Payment	Accounts Payable	Accounts Payable
	Cash	Cash
	Merchandise Inventory	Merchandise Inventory