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  • ACC 291T Wk 1 - Practice: Connect Knowledge Check (New)

ACC 291T Wk 1 - Practice: Connect Knowledge Check (New)



Prepare journal entries to record each of the following transactions. The company records purchases using the gross method and a perpetual inventory system.

 

Aug. 1 Purchased merchandise with an invoice price of $78,000 and credit terms of 2/10, n/30.

Aug. 11 Paid supplier the amount owed from the August 1 purchase.



Required information

[The following information applies to the questions displayed below.]

  

Allied Merchandisers was organized on May 1. Macy Co. is a major customer (buyer) of Allied (seller) products.

 

May 3 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000).

  5 Allied sold 1,000 of the units in inventory for $14 per unit (invoice total: $14,000) to Macy Co. under credit terms 2/10, n/60. The goods cost Allied $10,000.

  7 Macy returns 100 units because they did not fit the customer’s needs (invoice amount: $1,400). Allied restores the units, which cost $1,000, to its inventory.

  8 Macy discovers that 100 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $600 to compensate for the damage.

  15 Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount.

 

Prepare the appropriate journal entries for Macy Co. to record each of the May transactions. Macy is a retailer that uses the gross method and a perpetual inventory system, and purchases these units for resale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

  



Prepare journal entries to record the following transactions for a retail store. The company uses a perpetual inventory system and the gross method.

  

Apr. 2 Purchased $5,500 of merchandise from Lyon Company with credit terms of 2/15, n/60, invoice dated April 2, and FOB shipping point.

  3 Paid $200 cash for shipping charges on the April 2 purchase.

  4 Returned to Lyon Company unacceptable merchandise that had an invoice price of $800.

  17 Sent a check to Lyon Company for the April 2 purchase, net of the discount and the returned merchandise.

  18 Purchased $10,300 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 $10,300 owed on the April 18 purchase.

  28 Sent check to Frist paying for the April 18 purchase, net of the allowance and the discount.

 



Prepare journal entries to record each of the following transactions. The company records purchases using the gross method and a perpetual inventory system.

 

Sept. 15 Purchased merchandise with an invoice price of $75,000 and credit terms of 2/5, n/15.

Sept. 29 Paid supplier the amount owed on the September 15 purchase.




Prepare journal entries to record each of the following transactions of a merchandising company. The company uses a perpetual inventory system and the gross method.

 

Nov. 5 Purchased 500 units of product at a cost of $20 per unit. Terms of the sale are 3/10, n/60; the invoice is dated November 5.

Nov. 7 Returned 45 defective units from the November 5 purchase and received full credit.

Nov. 15 Paid the amount due from the November 5 purchase, minus the return on November 7.



ACC 291T Wk 1 - Practice: Connect Knowledge Check (New)

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