Mod 4(c) - CH 4 EXERCISES/PROBLEMS (51 pts) Hide or show questions eBook Calcula
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Mod 4(c) - CH 4 EXERCISES/PROBLEMS (51 pts)
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Sales-Related Transactions
The selected transactions below were completed by Affordable Supplies Co., which sells supplies primarily to wholesalers and occasionally to retail customers.
Instructions:
Illustrate the effects on the accounts and financial statements of recording the following transactions of Affordable Supplies Co.
If no account or activity is affected, select "No effect" from the dropdown list and leave the corresponding number entry box blank. Enter account decreases, cash outflows, and the income statement effects that reduce net income as negative amounts.
Jan. 6. Sold merchandise on account, $14,000, terms FOB shipping point, n/eom. The cost of merchandise sold was $8,400.
Jan. 8. Sold merchandise on account, $20,000, terms FOB destination, 1/10, n/30. The cost of merchandise sold was $14,000.
Jan. 16. Sold merchandise on account, $19,500, terms FOB shipping point, n/30. The cost of merchandise sold was $11,700.
Jan. 18. Received check for amount due for sale on January 8.
Jan. 19. Issued credit memorandum for $4,500 for merchandise returned from sale on January 16. The cost of the merchandise returned was $2,700.
Jan. 26. Received check for amount due for sale on January 16 less credit memorandum of January 19.
Jan. 31. Paid Cashell Delivery Service $3,000 for merchandise delivered during January to customers under shipping terms of FOB destination.
Jan. 31. Received check for amount due for sale of January 6.
3 more Check My Work uses remaining.
Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity + = + Jan. 6. Jan. 6. Statement of Cash Flows Income StatementExplanation / Answer
Jan. 6. Sold merchandise on account, $14,000, terms FOB shipping point, n/eom. The cost of merchandise sold was $8,400. Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity 14000 = + 5600 Jan. 6. -8400 Jan. 6. Statement of Cash Flows Income Statement No effect Sales 14000 Cost of Good sold -8400 5600 Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity 20000 -14000 = + 6000 Jan. 8. Jan. 8. Statement of Cash Flows Income Statement No effect Sales 20000 Cost of Good sold -14000 6000 Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity 19500 + -11700 = + 7800 Jan. 16. Jan. 16. Statement of Cash Flows Income Statement No effect Sales 19500 Cost of Good sold -11700 7800 Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity 19800 + -20000 = 0 + -200 Jan. 18. Jan. 18. Statement of Cash Flows Income Statement Cash Receipts from customer 19800 Sales Discout -200 working (20000*99% Statement of Cash Flows Balance Sheet Assets = Liabilities + Stockholders' Equity -4500 + 2700 + = + -1800 Jan. 19. Statement of Cash Flows Income Statement No effect Sales return -4500 Cost of Good sold 2700 Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity 15000 + -15000 = + Jan. 26. Jan. 26. Statement of Cash Flows Income Statement Cash Receipts from customer 15000 working (19500-4500) Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity -3000 + = + -3000 Jan. 31. Jan. 31. Statement of Cash Flows Income Statement Cash payment for expenses -3000 Freight in -3000 Statement of Cash Flows Balance Sheet Income Statement Assets = Liabilities + Stockholders' Equity 14000 + -14000 = + 0 Jan. 31. Statement of Cash Flows Income Statement Cash Receipts from customer 14000 0