Westar Co. formed a subsidiary, Star Co., in 2019 to retail a special line of Westar's products. All Star's purchases are made from Westar Co. at 30% above Wastar's cost. During 2019, Westar sold merchandise that cost $45,000 to Star for $53,000, and Star sold all the merchandise to its customers for $59,500. Journalize the merchandise entries for both Westar and Star
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- Lambert Corporation sells merchandise at a list price of $70,000 with accompanying terms of 2/10, n/ 30 on December 8, 2019. By December 18, 2019, Lambert had collected from customers for merchandise originally billed at $46,000. By December 31, 2019, additional collections had been received on sales originally billed for $18,000, and sales returns and allowances of $1,500 had been granted by Lambert. By January 15, 2020, all the remaining balances due had been collected.Vangie Company, a merchandising concern entity, has the following transactions during 2020: Purchased merchandise amounting to P100,000. Terms: 2/10, n/30. Sold merchandise to various customers, P125,000. Cost of merchandise sold, P65,000. Approved and accepted the return of merchandise from customer due to wrong delivery, P12,000. The cost of the inventory is P8,000. Paid freight for merchandise sold, P12,000. Returned merchandise to suppliers due to damages, P15,000. Acquired merchandise from various suppliers, P180,000. Terms: less 10%, 2/10, n/30. Paid accounts payable to various suppliers amounting to P90,000 less 2% discount Sold merchandise to various customers, P90,000. Cost of merchandise sold, P55,000. Received proceeds from accounts receivable collection amounted to P100,000, net of 2% discounts. Paid freight for merchandise purchased, P18,000. Requirements: Record the above transactions using Periodic Inventory System Perpetual Inventory SystemLambert Corporation sells merchandise at a list price of $70,000 with accompanying terms of 2/10, n/30 on December 8, 2019. By December 18, 2019, Lambert had collected from customers for merchandise originally billed at $46,000. By December 31, 2019, additional collections had been received on sales originally billed for $18,000, and sales returns and allowances of $1,500 had been granted by Lambert. By January 15, 2020, all the remaining balances due had been collected. Instructions: 1. Prepare the journal entries to record each of the following items assuming that Lambert records accounts receivable and sales at the gross price: A. the sale of the merchandise B. collections received by December 18, 2019 C. collections received by December 31, 2019 D. sales returns and allowances (not estimated in the period of sale) E. any required year-end adjustments F. any January 1, 2020, reversing entries G. the collections received by January 15, 2020 2. Prepare the…
- Lambert Corporation sells merchandise at a list price of $70,000 with accompanying terms of 2/10, n/30 on December 8, 2019. By December 18, 2019, Lambert had collected from customers for merchandise originally billed at $46,000. By December 31, 2019, additional collections had been received on sales originally billed for $18,000, and sales returns and allowances of $1,500 had been granted by Lambert. By January 15, 2020, all the remaining balances due had been collected. Required: 1. Prepare the journal entries to record each of the following items assuming that Lambert records accounts receivable and sales at the gross price: A. the sale of the merchandise B. collections received by December 18, 2019 C. collections received by December 31, 2019 D. sales returns and allowances (not estimated in the period of sale) E. any required year-end adjustments F. any January 1, 2020, reversing entries G. the collections received by January 15, 2020 2. Prepare the journal…Sheffield Co. uses the gross method to record sales made on credit. On June 1, 2020, it made sales of $55,000 with terms 4/15, n/45. On June 12, 2020, Sheffield received full payment for the June 1 sale.Prepare the required journal entries for Sheffield Co.Eastman Corporation sells merchandise with a list price of $13,000 on February 1, 2019, with terms of 1/10, n/30. On February 10, 2019, payment was received on merchandise originally billed for $7,500, and the balance due was received on March 1, 2019. Required: 1. Prepare the journal entries to record the preceding information assuming that Eastman records accounts receivable and sales at (a) the gross price and (b) the net price. 2. Next Level What implied annual interest rate is Eastman’s customer incurring by failing to take the cash (sales) discount? (Assume a 365-day year.) 3. Next Level Which method—recording accounts receivable at the gross price or net price—is theoretically superior? Why?
- Cruise Industries purchased $10,800 of merchandise on February 1, 2020, subject to a trade discount of 10% and with credit terms of 3/15, n/60. It returned $2,500 (gross price before trade or cash discount) on February 4. The invoice was paid on February 13. Assuming that Cruise uses the perpetual method for recording merchandise transactions, record the purchase, return, and payment using the gross method. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 6,578. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Assuming that Cruise uses the periodic method for recording merchandise transactions, record the purchase, return, and payment using the gross method. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 6,578. Credit account titles are…On May 1, 2021, Company A shipped merchandise costing $16,000 to Company B on consignment. Company A paid $1,400 in shipping costs to deliver the inventory. On September 30, 2021, Company B advised Company Athat all of the inventory had been sold for a total of $54,000. On October 15, 2021, Company A received payment from Company B for the proceeds, less a 12% commission. Required: Prepare all the journal entries for Company A to account for the transaction from April 2 through October 15.On June 3, 2020, Nash Company sold to Ann Mount merchandise having a sales price of $7,200 (cost $4,320) with terms of n/60, f.o.b. shipping point. Nash estimates that merchandise with a sales value of $720 will be returned. An invoice totaling $140 was received by Mount on June 8 from Olympic Transport Service for the freight cost. Upon receipt of the goods, on June 8, Mount returned to Nash $300 of merchandise containing flaws. Nash estimates the returned items are expected to be resold at a profit. The freight on the returned merchandise was $23, paid by Nash on June 8. On July 16, the company received a check for the balance due from Mount.Prepare journal entries for Nash Company to record all the events in June and July. The journal entries required are: To record sales To record cost of goods sold To record sales returns To record cost of goods returned To record the freight cost
- Restin Co. uses the gross method to record sales made on credit. On June 1, 2020, it made sales of $50,000 with terms 3/15, n/45. On June 12, 2020, Restin received full payment for the June 1 sale. Prepare the required journal entries for Restin Co.Vangie Company, a merchandising concern entity, has the following transactions during 2020:a. Purchased merchandise amounting to P100,000. Terms: 2/10, n/30.b. Sold merchandise to various customers, P125,000. Cost of merchandise sold, P65,000.c. Approved and accepted the return of merchandise from customer due to wrong delivery,P12,000. The cost of the inventory is P8,000.d. Paid freight for merchandise sold, P12,000.e. Returned merchandise to suppliers due to damages, P15,000.f. Acquired merchandise from various suppliers, P180,000. Terms: less 10%, 2/10, n/30.g. Paid accounts payable to various suppliers amounting to P90,000 less 2% discount taken.h. Sold merchandise to various customers, P90,000. Cost of merchandise sold, P55,000.i. Received proceeds from accounts receivable collection amounted to P100,000, net of 2%discounts.j. Paid freight for merchandise purchased, P18,000.Requirements:1. Record the above transactions usinga. Perpetual Inventory SystemThe following information is given regarding Dyosa Company:• The reciprocal account in the separate income statement of the home office amount to P225,000.• During the year 2020 (current year), the home office bills merchandise to the branch at 215%of cost.• The beginning inventory of the branch is P249,375.• During the 2020, the branch purchased from vendors merchandise amounting to P150,000.• The ending inventory of the branch as shown in the combined financial statements is P267,125.• The allowance for overvaluation before adjustment is P320.000.• The beginning inventory of the branch from the home office at cost is P153,125.• The unrealized profit at the end of the year must be decreased by P55,000. 1. What is the cost of goods sold in the combined financial statements at the end of 2020? 2. what is the total goods available for sale recorded in the branch's books at the end of 2020?