Problem Set B
PB
1.
LO 6.1Record journal entries for the following transactions of Furniture Warehouse.
- July 5: Purchased 30 couches at a cost of $150 each from a manufacturer. Credit terms are 2/15, n/30, invoice date July 5.
- July 10: Furniture Warehouse returned 5 couches for a full refund.
- July 15: Furniture Warehouse found 6 defective couches, but kept the merchandise for an allowance of $500.
- July 20: Furniture Warehouse paid their account in full with cash.
PB
2.
LO 6.1Record journal entries for the following transactions of Mason Suppliers.
- 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.
- Sep. 12: Mason Suppliers returned 8 hammers for a full refund.
- Sep. 16: Mason Suppliers found 4 defective hammers, but kept the merchandise for an allowance of $250.
- Sep. 28: Mason Suppliers paid their account in full with cash.
PB
3.
LO 6.2Costume Warehouse sells costumes and accessories and purchases their merchandise from a manufacturer. Review the following transactions and prepare the journal entry or entries if Costume Warehouse uses
- the perpetual inventory system
- the periodic inventory system
| Jun. 4 | Costume Warehouse purchases 88 costumes on credit at a purchase price of $15 per costume. The terms of the purchase are 5/15, n/30, with an invoice date of June 4. |
| Jun. 12 | Costume Warehouse returns 20 costumes to the manufacturer for a full refund. |
| Jun. 19 | Costume Warehouse pays in full for the remaining costumes, less the return. |
PB
4.
LO 6.2Pharmaceutical Supplies sells medical supplies and purchases their merchandise from a manufacturer. Review the following transactions and prepare the journal entry or entries if Pharmaceutical Supplies uses
- the perpetual inventory system
- the periodic inventory system
| Apr. 7 | Pharmaceutical Supplies purchases 50 medical stands on credit at a purchase price of $15 per stand. The terms of the purchase are 5/10, n/45, with an invoice date of April 7. |
| Apr. 11 | Pharmaceutical Supplies returns 18 stands to the manufacturer for a full refund. |
| Apr. 17 | Pharmaceutical Supplies pays in full for the remaining stands, less the return. |
PB
5.
LO 6.3Review the following transactions for April Anglers and record any required journal entries.
| Oct. 4 | April Anglers purchases 82 fishing poles at $33 each with cash. |
| Oct. 5 | April Anglers purchases 116 fishing poles at $30 each on credit. Terms of the purchase are 3/15, n/30, invoice date October 5. |
| Oct. 12 | April discovers 18 of the fishing poles are damaged from the October 4 purchase and returns them to the supplier for a full refund. April also discovers that 32 of the fishing poles from the October 5 purchase are the wrong length but keeps them since the supplier granted an allowance of $15 per fishing pole. |
| Oct. 24 | April pays their account in full from the October 5 purchase, less any returns, allowances, and/or discounts. |
PB
6.
LO 6.3Review the following transactions for Dish Mart and record any required journal entries. Note that all purchase transactions are with the same supplier.
| Nov. 5 | Dish Mart purchases 45 sets of cutlery for $100 per set with cash. |
| Nov. 9 | Dish Mart purchases 50 sets of cutlery for $120 per set on credit. Terms of the purchase are 5/15, n/60, invoice date November 9. |
| Nov. 13 | Dish Mart discovers 15 of the cutlery sets are damaged from the November 9 purchase and returns them to the supplier for a full refund. |
| Nov. 14 | Dish Mart purchases 30 sets of cutlery for $130 per set on credit. Terms of the purchase are 5/10, n/60, invoice date November 14. |
| Nov. 15 | Dish Mart discovers that 10 of the cutlery sets from the November 14 purchase and 20 of the cutlery sets from the November 5 purchase are missing a few spoons but keeps them since the supplier granted an allowance of $30 per set for the November 14 cutlery sets and $35 per set for the November 5 cutlery sets. Dish Mart and the supplier have agreed to reduce the amount of debt Dish Mart has outstanding instead of sending a separate check for the November 5 allowance in cash. |
| Nov. 24 | Dish Mart pays their account in full for all outstanding purchases, less any returns, allowances, and/or discounts. |
PB
7.
LO 6.4Review the following sales transactions for April Anglers and record any required journal entries.
| Oct. 4 | April Anglers made a cash sale of 40 fishing poles to customer Billie Dyer at a price of $55 per pole. The cost to April is $33 per pole. |
| Oct. 5 | April Anglers sells 24 fishing poles to customer Billie Dyer at a price of $52 per pole on credit. The cost to April is $30 per pole. Terms of the sale are 2/10, n/30, invoice date October 5. |
| Oct. 12 | Billie returns seven of the fishing poles from the October 4 purchase to April Anglers for a full refund. April returns these poles to their inventory at the original cost per pole. Billie also discovers that 6 of the fishing poles from the October 5 purchase are the wrong color but keeps them since April granted an allowance of $18 per fishing pole. |
| Oct. 24 | April pays their account in full from the October 5 purchase, less any returns, allowances, and/or discounts. |
PB
8.
LO 6.4Review the following sales transactions for Dish Mart and record any required journal entries. Note that all sales transactions are with the same customer, Bella Davies.
| Apr. 5 | Dish Mart made a cash sale of 22 sets of cutlery to Bella Davies for $330 per set. The cost per set to Dish Mart is $125 per set. |
| Apr. 9 | Dish Mart sells 14 sets of cutlery to Bella Davies on credit for $345 per set. The cost per set to Dish Mart is $120 per set. Terms of the sale are 2/15, n/60, invoice date April 9. |
| Apr. 13 | Bella returns nine of the cutlery sets from the April 9 sale to Dish Mart for a full refund. Dish Mart restores the cutlery to its inventory at the original cost of $120 per set. |
| Apr. 14 | Bella purchases 18 sets of cutlery for $275 per set on credit, at a cost to Dish Mart of $124 per set. Terms of the sale are 2/10, n/60, invoice date April 14. |
| Apr. 15 | Bella discovers that 5 of the cutlery sets from the April 14 purchase and 10 of the cutlery sets from the April 5 purchase are missing a few spoons but keeps them since Dish Mart granted an allowance of $175 per set for all dish sets. Dish Mart and Bella have agreed to reduce the amount Bella has outstanding instead of sending a separate check for the April 5 allowance in cash. |
| Apr. 28 | Bella Davies pays her account in full for all outstanding purchases, less any returns, allowances, and/or discounts. |
PB
9.
LO 6.5Record the following purchase transactions of Custom Kitchens Inc.
| Oct. 6 | Purchased 230 cabinet doors on credit at a cost of $46 per door. Shipping charges are an extra $2 cash per door and are not subject to discount. Terms of the purchase are 5/15, n/35, FOB Shipping Point, invoice dated October 6. |
| Oct. 9 | Purchased 100 cabinet doors with cash at cost of $40 per door. Shipping charges are an extra $3.25 cash per door and are not subject to discount. Terms of the purchase are FOB Destination. |
| Oct. 20 | Custom Kitchens Inc. pays in full for their purchase from October 6. |
PB
10.
LO 6.5Record 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. |
PB
11.
LO 6.5Record the following sales transactions of Custom Kitchens Inc.
| Nov. 12 | Made a cash sale to a customer for 34 cabinet doors at a sales price of $72 per door. The cost to Custom Kitchens Inc. is $46 per door. Shipping charges are an extra $3.15 cash per door and are not subject to discount. Terms of the sale are FOB Shipping Point. |
| Nov. 16 | Sold 22 doors on credit for $80 per door to a customer. The cost per door to Custom Kitchens Inc. is $40 per door. Shipping charges are an extra $4.00 cash per door and are not subject to discount. Terms of the sale are 5/15, n/40, FOB Destination, invoice dated November 12. |
| Nov. 24 | The customer pays in full for their purchase on November 16. |
PB
12.
LO 6.6The following is the adjusted trial balance data for Elm Connections as of December 31, 2019.
- Use the data provided to compute net sales for 2019.
- Compute the gross margin for 2019.
- Compute the gross profit margin ratio (rounded to nearest hundredth)
- Prepare a simple income statement for the year ended December 31, 2019.
- Prepare a multi-step income statement for the year ended December 31, 2019.
PB
13.
LO 6.6Following is the adjusted trial balance data for Garage Parts Unlimited as of December 31, 2019.
- Use the data provided to compute net sales for 2019.
- Compute the gross margin or 2019.
- Compute the gross profit margin ratio (rounded to nearest hundredth)
- Prepare a simple income statement for the year ended December 31, 2019.
- Prepare a multi-step income statement for the year ended December 31, 2019.
PB
14.
LO 6.7Review the following transactions for April Anglers and record any required journal entries.
| Oct. 4 | April Anglers purchases 82 fishing poles at $33 each with cash. |
| Oct. 5 | April Anglers purchases 116 fishing poles at $30 each on credit. Terms of the purchase are 3/15, n/30, invoice date October 5. |
| Oct. 12 | April discovers 18 of the fishing poles are damaged from the October 4 purchase and returns them to the supplier for a full refund. April also discovers that 32 of the fishing poles from the October 5 purchase are the wrong length but keeps them since the supplier granted an allowance of $15 per fishing pole. |
| Oct. 24 | April pays their account in full from the October 5 purchase, less any returns, allowances, and/or discounts. |
PB
15.
LO 6.7Review the following sales transactions for Dish Mart and record any required journal entries. Note that all sales transactions are with the same customer, Bella Davies.
| Apr. 5 | Dish Mart made a cash sale of 22 sets of cutlery to Bella Davies for $330 per set. The cost per set to Dish Mart is $125 per set. |
| Apr. 9 | Dish Mart sells 14 sets of cutlery to Bella Davies on credit for $345 per set, with a cost to Dish Mart of $120 per set. Terms of the sale are 2/15, n/60, invoice date April 9. |
| Apr. 13 | Bella discovers 9 of the cutlery sets are damaged from the April 9 sale and returns them to Dish Mart for a full refund. |
| Apr. 14 | Bella purchases 18 sets of cutlery for $275 per set on credit, at a cost to Dish Mart of $124 per set. Terms of the sale are 2/10, n/60, invoice date April 14. |
| Apr. 15 | Bella discovers that 5 of the cutlery sets from the April 14 purchase and 10 of the cutlery sets from the April 5 purchase are missing a few spoons but keeps them since Dish Mart granted an allowance of $175 per set for all dish sets. Dish Mart and Bella have agreed to reduce the amount Bella has outstanding instead of sending a separate check for the April 5 allowance in cash. |
| Apr. 28 | Bella Davies pays her account in full for all outstanding purchases, less any returns, allowances, and/or discounts. |