Le Kai Arts sells quality art work, with prices for individual pieces ranging from $1,000 to $50,000. Sales are infrequent, typically only six to ten pieces per week. The following transactions occurred during the first week of June. Perpetual inventory is used. On June 1, sold an $1,800 framed print ($1,200 cost) to Likert Antiques on account, with 2/10, n/30 credit terms. On June 2, sold three framed etchings totaling $5,200 ($2,800 cost) to Annabelle Herrera, who used the United Merchants Card to charge the cost of the etchings. Le Kai mailed the credit card sales slip to United Merchants the same day. United Merchants will send a check within seven days after deducting a two percent fee. On June 4, sold a $3,600 oil painting ($2,000 cost) to Ryan LaLander, who paid with a personal check. On June 5, sold a $6,000 watercolor ($2,200 cost) to Julie and Bobby Herman, who used their Great American Bank Card to charge the purchase of the painting. Le Kai deposited the credit card sales slip the same day and received immediate credit in the company’s checking account. The bank charged a one percent fee. On June 6, received payment from Likert Antiques for its June 1 purchase. On June 7, received a check from United Merchants for the June 2 sale. Required Prepare journal entries to record the Le Kai Arts transactions. (Round to the nearest dollar.) General Journal Date Description Debit Credit June 1 Answer Answer Answer Answer To record credit sales revenue. Answer Answer Answer Answer To record cost of goods sold. June 2 Answer Answer Credit Card Fee Expense Answer Answer AnswerAccounts - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record credit card sales. June 2 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cost of goods sold. June 4 Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cash sales. June 4 Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cost of goods sold. June 5 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer Credit Card Fee Expense Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record credit card sales. June 5 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cost of goods sold. June 6 Cash AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue To record collection from Likert Antiques. June 7 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue To record collection from United Merchants.

Le Kai Arts sells quality art work, with prices for individual pieces ranging from $1,000 to $50,000. Sales are infrequent, typically only six to ten pieces per week. The following transactions occurred during the first week of June. Perpetual inventory is used. On June 1, sold an $1,800 framed print ($1,200 cost) to Likert Antiques on account, with 2/10, n/30 credit terms. On June 2, sold three framed etchings totaling $5,200 ($2,800 cost) to Annabelle Herrera, who used the United Merchants Card to charge the cost of the etchings. Le Kai mailed the credit card sales slip to United Merchants the same day. United Merchants will send a check within seven days after deducting a two percent fee. On June 4, sold a $3,600 oil painting ($2,000 cost) to Ryan LaLander, who paid with a personal check. On June 5, sold a $6,000 watercolor ($2,200 cost) to Julie and Bobby Herman, who used their Great American Bank Card to charge the purchase of the painting. Le Kai deposited the credit card sales slip the same day and received immediate credit in the company’s checking account. The bank charged a one percent fee. On June 6, received payment from Likert Antiques for its June 1 purchase. On June 7, received a check from United Merchants for the June 2 sale. Required Prepare journal entries to record the Le Kai Arts transactions. (Round to the nearest dollar.) General Journal Date Description Debit Credit June 1 Answer Answer Answer Answer To record credit sales revenue. Answer Answer Answer Answer To record cost of goods sold. June 2 Answer Answer Credit Card Fee Expense Answer Answer AnswerAccounts - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record credit card sales. June 2 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cost of goods sold. June 4 Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cash sales. June 4 Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cost of goods sold. June 5 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer Credit Card Fee Expense Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record credit card sales. June 5 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer To record cost of goods sold. June 6 Cash AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue To record collection from Likert Antiques. June 7 AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue Answer Answer AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue To record collection from United Merchants.

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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Question

On June 1, sold an $1,800 framed print ($1,200 cost) to Likert Antiques on account, with 2/10, n/30 credit terms.

On June 2, sold three framed etchings totaling $5,200 ($2,800 cost) to Annabelle Herrera, who used the United Merchants Card to charge the cost of the etchings. Le Kai mailed the credit card sales slip to United Merchants the same day. United Merchants will send a check within seven days after deducting a two percent fee.

On June 4, sold a $3,600 oil painting ($2,000 cost) to Ryan LaLander, who paid with a personal check.

On June 5, sold a $6,000 watercolor ($2,200 cost) to Julie and Bobby Herman, who used their Great American Bank Card to charge the purchase of the painting. Le Kai deposited the credit card sales slip the same day and received immediate credit in the company’s checking account. The bank charged a one percent fee.

On June 6, received payment from Likert Antiques for its June 1 purchase.

On June 7, received a check from United Merchants for the June 2 sale.

Required

Prepare journal entries to record the Le Kai Arts transactions. (Round to the nearest dollar.)

General Journal
Date	Description	Debit	Credit
June 1		Answer	Answer
		Answer	Answer
	To record credit sales revenue.
		Answer	Answer
		Answer	Answer
	To record cost of goods sold.
June 2		Answer	Answer
	Credit Card Fee Expense	Answer	Answer
	AnswerAccounts - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	To record credit card sales.
June 2	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	To record cost of goods sold.
June 4		Answer	Answer
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	To record cash sales.
June 4		Answer	Answer
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	To record cost of goods sold.
June 5	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	Credit Card Fee Expense	Answer	Answer
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	To record credit card sales.
June 5	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	To record cost of goods sold.
June 6	Cash
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue
	To record collection from Likert Antiques.
June 7	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue	Answer	Answer
	AnswerAccounts Receivable - Likert AntiquesAccounts Receivable - United MerchantsCashCost of Goods SoldCredit Card Fee ExpenseInventorySales DiscountsSales Revenue
	To record collection from United Merchants.

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