Cycle Wholesaling sold merchandise on account, with terms n/60, to Sarah's Cycles on February 1 for $500 (cost of goods sold of $340). On February 9, Sarah's Cycles returned to Cycle Wholesaling one-quarter of the merchandise from February 1 (cost of goods returned was $85). Cycle Wholesaling uses a perpetual inventory system, and it allows returns only within 15 days of initial sale. Required: 1. to 3. Prepare the journal entries to record the sale on February 1, goods returned on February 9, and cash collected on March 2 4. Calculate the gross profit percentage for the sale to Sarah's Cycles
Cycle Wholesaling sold merchandise on account, with terms n/60, to Sarah's Cycles on February 1 for $500 (cost of goods sold of $340). On February 9, Sarah's Cycles returned to Cycle Wholesaling one-quarter of the merchandise from February 1 (cost of goods returned was $85). Cycle Wholesaling uses a perpetual inventory system, and it allows returns only within 15 days of initial sale. Required: 1. to 3. Prepare the journal entries to record the sale on February 1, goods returned on February 9, and cash collected on March 2 4. Calculate the gross profit percentage for the sale to Sarah's Cycles
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Cycle Wholesaling sold merchandise on account, with terms n/60, to Sarah's Cycles on February 1 for $500 (cost of goods sold of
$340). On February 9, Sarah's Cycles returned to Cycle Wholesaling one-quarter of the merchandise from February 1 (cost of goods
returned was $85). Cycle Wholesaling uses a perpetual inventory system, and it allows returns only within 15 days of initial sale
Required:
1. to 3. Prepare the journal entries to record the sale on February 1, goods returned on February 9, and cash collected on March 2
4. Calculate the gross profit percentage for the sale to Sarah's Cycles.
Complete this question by entering your answers in the tabs below.
Req 1 to 3
Prepare the journal entries to record the sale on February 1, goods returned on February 9, and cash collected on March 2. (If no entry is
required for a transaction/event, select "No Journal Entry Required" in the first account field.).
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Req 4
Journal entry worksheet
<
1
2
3
Date
February 01
Note: Enter debits before credits
4
Record the sales on account of $500 with terms n/60.
5
General Journal
Debit
Credit
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