Cost of goods sUIU Operating expenses Income tax expense 32,0 18,000 $10,000 $22,000 Net income Determine the company's gross profit rate and profit margin for both years. Discuss the cause for changes in the ratios. E5-1 This information relates to Rice Co. 1. On April 5, purchased merchandise from Jax Company for $28,000, terms 2/10, n/3 2. On April 6, paid freight costs of $700 on merchandise purchased from Jax. 3. On April 7, purchased equipment on account for $30,000. 4. On April 8, returned $3,600 of April 5 merchandise to Jax Company. * On April 15, paid the amount due to Jax Company in full. Instructions la) Prepare the journal entries to record the transactions listed above on Rice Co.s books. Rice Co. uses a perpetual inventory system. (6) Assume that Rice Co. paid the balance due to Jax Company on May 4 instead of April 15. Prepare the journal entry to record this payment. E5-2 Assume that on September 1, Office Depot had an inventory that included a variety of calculators. The company uses a perpetual inventory system. During September, these transactions occurred. Purchased calculators from Dragoo Co. at a total cost of $1,650, terms n/30 6 9. Sept. Paid freight of $50 on calculators purchased from Dragoo Co. 10 Returned calculators to Dragoo Co. for $66 credit because they did ne meet specifications. 12 Sold calculators costing $520 for $690 to Fryer Book Store, terms n/30. Fryer Book Store for the return of one calcula n/
Cost of goods sUIU Operating expenses Income tax expense 32,0 18,000 $10,000 $22,000 Net income Determine the company's gross profit rate and profit margin for both years. Discuss the cause for changes in the ratios. E5-1 This information relates to Rice Co. 1. On April 5, purchased merchandise from Jax Company for $28,000, terms 2/10, n/3 2. On April 6, paid freight costs of $700 on merchandise purchased from Jax. 3. On April 7, purchased equipment on account for $30,000. 4. On April 8, returned $3,600 of April 5 merchandise to Jax Company. * On April 15, paid the amount due to Jax Company in full. Instructions la) Prepare the journal entries to record the transactions listed above on Rice Co.s books. Rice Co. uses a perpetual inventory system. (6) Assume that Rice Co. paid the balance due to Jax Company on May 4 instead of April 15. Prepare the journal entry to record this payment. E5-2 Assume that on September 1, Office Depot had an inventory that included a variety of calculators. The company uses a perpetual inventory system. During September, these transactions occurred. Purchased calculators from Dragoo Co. at a total cost of $1,650, terms n/30 6 9. Sept. Paid freight of $50 on calculators purchased from Dragoo Co. 10 Returned calculators to Dragoo Co. for $66 credit because they did ne meet specifications. 12 Sold calculators costing $520 for $690 to Fryer Book Store, terms n/30. Fryer Book Store for the return of one calcula n/
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Two pictures. Question on the bottom of first page and continues to 2nd picture on the top.
Transcribed Image Text:Cost of goods sUIU
Operating expenses
Income tax expense
32,0
18,000
$10,000
$22,000
Net income
Determine the company's gross profit rate and profit margin for both years. Discuss the
cause for changes in the ratios.
E5-1 This information relates to Rice Co.
1. On April 5, purchased merchandise from Jax Company for $28,000, terms 2/10, n/3
2. On April 6, paid freight costs of $700 on merchandise purchased from Jax.
3. On April 7, purchased equipment on account for $30,000.
Transcribed Image Text:4. On April 8, returned $3,600 of April 5 merchandise to Jax Company.
* On April 15, paid the amount due to Jax Company in full.
Instructions
la) Prepare the journal entries to record the transactions listed above on Rice Co.s books.
Rice Co. uses a perpetual inventory system.
(6) Assume that Rice Co. paid the balance due to Jax Company on May 4 instead of April 15.
Prepare the journal entry to record this payment.
E5-2 Assume that on September 1, Office Depot had an inventory that included a variety
of calculators. The company uses a perpetual inventory system. During September, these
transactions occurred.
Purchased calculators from Dragoo Co. at a total cost of $1,650, terms n/30
6
9.
Sept.
Paid freight of $50 on calculators purchased from Dragoo Co.
10 Returned calculators to Dragoo Co. for $66 credit because they did ne
meet specifications.
12
Sold calculators costing $520 for $690 to Fryer Book Store, terms n/30.
Fryer Book Store for the return of one calcula
n/
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education