In July 10, 2020, Marigold Ltd. sold $1.8 million of compressors to retailers on account. Marigold had paid $918,000 for these compressors. Marigold grants the right to return compressors that do not sell in three months following delivery. Past experience indicates that the normal return rate is 10%. By October 11, 2020, retailers returned compressors to Marigold and were granted a cash refund totalling $175,000. Marigold uses a perpetual inventory system and follows IFRS. Prepare Marigold's journal entries to record the sale on July 10, 2020. (Credit account titles are automatically indented when the

In July 10, 2020, Marigold Ltd. sold $1.8 million of compressors to retailers on account. Marigold had paid $918,000 for these compressors. Marigold grants the right to return compressors that do not sell in three months following delivery. Past experience indicates that the normal return rate is 10%. By October 11, 2020, retailers returned compressors to Marigold and were granted a cash refund totalling $175,000. Marigold uses a perpetual inventory system and follows IFRS. Prepare Marigold's journal entries to record the sale on July 10, 2020. (Credit account titles are automatically indented when the

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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ABC Company, a department store operates a customer loyalty program.The entity grants program members loyalty points when they spend a specified amount on their products. Program members can redeem the points for future purchases.The points have no expiry date. During 2020, the sales amounted to P 10,000,000 and the entity grants 5 points for every P 100 purchase. Management expects that only 70% of the points will be redeemed. Fair values of products sold and the reward points for the year were P 9,000,000 and P 1,000,000, respectively.As of December 31, 2020, half of the total points granted have already been redeemed. In 2021, the management revised its expectations to 90% of the points will be redeemed. As of December 31, 2021, there is a redemption of 25% of the remaining points.What amount should be reported as revenue earned from loyalty points in 2020?To input answers, kindly follow the sample format below(no peso sign, with comma, no space):ex. 100,000Failure to follow the…
Crest Corporation established its Poblacion branch in 2019. Merchandise costing P120,000 is shipped to this branch. During the initial year, the home office acquires an equipment for P80,000 to be carried in the branch books, and the branch maintains physical possession and use. The equipment has a useful life of 4 years. The branch sells 60 percent of the inventory for P100,800 on account and subsequently collected half of the amount. The branch remits 80 percent in cash to the Home Office. What is the correct Home Office account balance on the records of the branch?
Please show your solution in good accounting form. Thank you!
Carla Vista Corporation shipped $20,100 of merchandise on consignment to Wildhorse Company. Carla Vista paid freight costs of $2,000. Wildhorse Company paid $510 for local advertising, which is reimbursable from Carla Vista. By year-end, 58% of the merchandise had been sold for $20,100. Wildhorse notified Carla Vista, retained a 10% commission, and remitted the cash due to Carla Vista. Prepare Carla Vista's journal entry when the cash is received. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
On August 15, 2020, Japan Ideas consigned 770 electronic play systems, costing $100 each, to YoYo Toys Company. The cost of shipping the play systems amounted to $1,100 and was paid by Japan Ideas. On December 31, 2020, an account sales summary was received from the consignee, reporting that 420 play systems had been sold for $170 each. Remittance was made by the consignee for the amount due, after deducting a 20% commission. Calculate the inventory value of the units unsold in the hands of the consignee at December 31, 2020. Calculate the profit for the consignor for the units sold at December 31, 2020. Calculate the amount of cash that will be remitted by the consignee at December 31, 2020.
Moon Co. sells food blenders. During 2019, Moon made 37,000 blenders at an average cost of $80. It sold out 25,000 food blenders at an average price of $130. Moon provides a 2-year warranty for each blender sold and estimates 9% of blenders will be returned for warranty with an estimated cost of $36 each. By the end of 2019, Moon has spent $44,000 servicing the warranty repairs. All the above transactions have been settled in cash. During 2019, Moon has 50 employees who work 5-day per week and get paid each other Friday. Salaries of $324,000 and payroll expense of $37,000 have been paid until December 22. Since the business grows quickly, Moon needs cash to expand. By the end of 2018, the Board of Directors authorized the management to issue 10-year bonds with a par value of $3,000,000, annual contract interest rate of 8% and semi-annual interest payments. Moon chose to use the straight-line method to amortize discount or premium on its bonds. On January 1, 2019, management issued…
ABC Company, a grocery retailer, operates a customer loyalty program. The entity grants program members loyalty points when they spend a specified amount on groceries. Program members can redeem the points for further groceries. The points have no expiry date. During 2019, the sales amounted to P7,000,000 and the entity have granted 10,000 points. Management expects that only 80% of the points will be redeemed. The cost of each loyalty point is P100. As of December 31, 2019, 4,800 points have already been redeemed. In 2020, the management revised its expectations to 90% of the points will be redeemed. As of December 31, 2020, the entity redeemed 2,400 points. What amount should be reported as revenue earned from loyalty points in 2020?
Halifax Manufacturing allows its customers to return merchandise for any reason up to 90 days after delivery and receive a credit to their accounts. All of Halifax's sales are for credit (no cash is collected at the time of sale). The company began 2021 with a refund liability of $390,000. During 2021, Halifax sold merchandise on account for $12,400,000. Halifax's merchandise costs it 65% of merchandise selling price. Also during the year, customers returned $368,000 in sales for credit, with $203,000 of those being returns of merchandise sold prior to 2021, and the rest being merchandise sold during 2021. Sales returns, estimated to be 3% of sales, are recorded as an adjusting entry at the end of the year. a) Record the year-end adjusting entry for estimated returns. b) Record the adjusting entry for the estimated return of merchandise to inventory. c) What is the amount of the year-end refund liability after the adjusting entry is recorded?
On October 20, 2021, ABC Co. consigned 40 freezers in Holden Co. for sale P1,000 each and paid P800 in transportation costs. On December 30, 2021, Holden reported the sale of 10 freezers and remitted P8,500. The remittance was net of the agreed 15% commission. What amount should ABC recognize as consignment sales revenue for 2021? [A] 7,700 [B] 8,500 [C] 9,800 [D] 10,000
6. During 2019, Reed Corporation sold merchandise for a total of $900,000. The cost of merchandise to Reed was $675,000. Reed offers credit terms of 1/10, n/30 to encourage early payment. At year-end, there are $22,500 of sales still eligible for the 1% discount. Reed believes that all of the companies will pay within the discount period to receive the 1% discount. Assume Reed's fiscal year is December 31. Reed's adjusting journal entry will include: A) A debit to Sales Discounts for $225 B) A credit to Allowance for Sales Discounts for $2,250 C) A debit to Sales Discounts for $2,050 D) A credit to Sales Discounts for $225 E) No adjusting journal entry is required. Discount will be recognized when payment is received.
Carla Vista Company sells goods to Pearl Company during 2020. It offers Pearl the following rebates based on total sales to Pearl. If total sales to Pearl are 11,200 units, it will grant a rebate of 2%. If it sells up to 19,600 units, it will grant a rebate of 4%. It if sells up to 29,200 units, it will grant a rebate of 6%. In the first quarter of the year, Carla Vista sells 9,000 units to Pearl at a sales price of $90,000. Based on past experience, Carla Vista has sold over 40,000 units to Pearl, and these sales normally take place in the third quarter of the year.
Cullumber Company sells goods to Riverbed Company during 2020. It offers Riverbed the following rebates based on total sales to Riverbed. If total sales to Riverbed are 9,000 units, it will grant arebate of 3%. If it sells up to 21.100 units, it will grant a rebate of 5%. If it sells up to 32,200 units, it will grant a rebate of 6%, In the first quarter of the year. Culumber sells 9,900 units to Riverbed at a sales price of $99,000. Cullumber, based on past experience, has sold over 36,200 units to Riverbed, and these sales normally take place in the third quarter of the year. What amount of revenue should Cullumber report for the sale of the 9,900 units in the first quarter of the year. Reverue eTextbook and Media List of Accounts Attempts: 0 of 3 used Submit Arawer Savefor Later