A company purchased $12,000 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. On June 20, it returned $2,400 of thatmerchandise. The shipping charges for the purchase totaled $1,500. On June 24, it paid the balance owed for the merchandise taking any discountit is entitled to. The cash pald on June 24 equals:Multiple Choice$10,812.O$8,952.O$12,800.$13,500.$12,900.

Step 1: Calculate the balance after the return Purchase$12,000Less: Purchase return 2,400Balance…

Answered: A company purchased $12,000 of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Oswego Clay Pipe Company sold $46,000 of pipe to Southeast Water District 45 on April 12 of the current year with terms 1/10,n/30. Oswego uses the gross method of accounting for sales discounts. What entry would Oswego make on April 18, assuming the customer made the correct payment on that date? Account Title Debit Credit Cash Sales 45,540 460 Accounts receivable 46,000 Account Title Debit Credit Cash 46,000 Accounts receivable Sales 45,540 460 Account Title Debit Credit Cash 45,540 Sales discounts 460 Accounts receivable 46,000 Account Title Debit Credit Cash 46,000 Sales discounts 460 Accounts receivable 46,000 Sales discounts forfeited 460
16.On October 17, Conrad Beauty Supplies bought $42,000 of goods with terms of 1/10, n/30. One-half of the bill was paid on October 24, and the rest of the bill was paid on October 31. Assume that the seller has agreed to grant discounts on partial payments.Required: Prepare journal entries for October 24 using the: 1. Gross Method2. Net Method
am. 103.
On March 5 PV Inc purchased $3,300 worth of merchandise from Panther Supply with the terms 2/10,n/30 On March 14, PV Inc paid Panther Supply the amount owed less the discount. Show the journal entry for March 5 and March 14
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A company purchased $8, 200 of merchandise on June 15th with terms of 3/10, n/45. on June 20, it returned $410 of that merchandise. on June 24th it paid the balance owed for the merchandise taking any discount it was entitled to. The cash paid ok june 24th is a) 8, 200 b) 7, 790 c) 7,556 d) 7,597 e) 7, 954
Company X sold merchandise for $50,000 with terms 3/30, n/90 on January 1. On January 29, Company X received half the payment in cash. On March 1, they received the remaining half. Prepare the journal entries to record the sale and the receipt of cash under (1) the gross method and (2) the net method. What effect does using the gross method vs. the net method have on the company’s current ratio after the sale? After the receipt of cash?

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