Homework Help is Here – Start Your Trial Now!
Business
Accounting
No No No No No er 31

No No No No No er 31

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
100%
Resgan Corporation is a wholesale distributor of truck replacement parts. Initial amounts taken from Reagan's records are as follows: Inventory at Decenber 31 (based on a physical count of goods in Reagan's warchouse on December 31) $1,400,e0e Accounts payable at December 31: Vendor Baker Corpany Charlie Corpany Dolly Corpany Еagler Companу Full Company Amount $ 295,000 248, 000 Terms 28, 10 days, пet 38 Net 30 Net 30 330,eee Net 30 255, 0ee Net 30 Greg Company Net 30 Accounts payable, December 31 $1,120,000 Sales for the year $9,750,eee Additional Information: 1. Parts held by Reagan on consignment from Charlie, amounting to $230,000, were included in the physical count of goods in Reagan's warehouse and in accounts payable at December 31. 2 Parts totaling $37,000, which were purchased from Full and paid for in December, were sold in the last week of the year and appropriately recorded as sales of $43,000. The parts were included in the physical count of goods in Reagan's worehouse on December 31 becouse the parts were on the loading dock waiting to be picked up by customers. 3. Parts in transit on December 31 to customers, shipped f.o.b. shipping point on December 28, amounted to $64,000. The customers received the parts on January 6 of the following year. Sales of $70,000 to the customers for the parts were recorded by Reagan on January 2. 4. Retsilers were holding goods on consignment from Resgan, which had a cost of $360,000 and a retail value of $400,000. 5. Goods were in transit from Greg to Reagen on December 31. The cost of the goods was $40,000, and they were shipped f.o.b. shipping point on December 29. 6. A freight bill in the amount of $3,500 specifically relating to merchandise purchased in December, all of which was still in the inventory at December 31, was received on January 3. The freight bill was not included in either the inventory or in acounts payable at December 31. 7. All the purchases from Baker occurred during the lsst seven days of the year. These items have been recorded in sccounts payable and eccounted for in the physical inventory at cost before discount. Reegan's policy is to pay invoices in time to take odventege of all discounts, adjust inventory occordingly, and record accounts payable net of discounts. Required: Complete the following schedule of adjustments to the initial amounts. (Amounts to be deducted should be Indicated with a minus sign.) Accounts Payable 1,120,000 S 9,750,000 Inventory Salee Initial amounts 1,400,000S Adjustments-increase (decrease): 1. 2. 3. 4. 5. 6. 7. Total adjustments Adjusted amounts 1,400,000 1,120,000 $ 9,750,000
Transcribed Image Text:Resgan Corporation is a wholesale distributor of truck replacement parts. Initial amounts taken from Reagan's records are as follows: Inventory at Decenber 31 (based on a physical count of goods in Reagan's warchouse on December 31) $1,400,e0e Accounts payable at December 31: Vendor Baker Corpany Charlie Corpany Dolly Corpany Еagler Companу Full Company Amount $ 295,000 248, 000 Terms 28, 10 days, пet 38 Net 30 Net 30 330,eee Net 30 255, 0ee Net 30 Greg Company Net 30 Accounts payable, December 31 $1,120,000 Sales for the year $9,750,eee Additional Information: 1. Parts held by Reagan on consignment from Charlie, amounting to $230,000, were included in the physical count of goods in Reagan's warehouse and in accounts payable at December 31. 2 Parts totaling $37,000, which were purchased from Full and paid for in December, were sold in the last week of the year and appropriately recorded as sales of $43,000. The parts were included in the physical count of goods in Reagan's worehouse on December 31 becouse the parts were on the loading dock waiting to be picked up by customers. 3. Parts in transit on December 31 to customers, shipped f.o.b. shipping point on December 28, amounted to $64,000. The customers received the parts on January 6 of the following year. Sales of $70,000 to the customers for the parts were recorded by Reagan on January 2. 4. Retsilers were holding goods on consignment from Resgan, which had a cost of $360,000 and a retail value of $400,000. 5. Goods were in transit from Greg to Reagen on December 31. The cost of the goods was $40,000, and they were shipped f.o.b. shipping point on December 29. 6. A freight bill in the amount of $3,500 specifically relating to merchandise purchased in December, all of which was still in the inventory at December 31, was received on January 3. The freight bill was not included in either the inventory or in acounts payable at December 31. 7. All the purchases from Baker occurred during the lsst seven days of the year. These items have been recorded in sccounts payable and eccounted for in the physical inventory at cost before discount. Reegan's policy is to pay invoices in time to take odventege of all discounts, adjust inventory occordingly, and record accounts payable net of discounts. Required: Complete the following schedule of adjustments to the initial amounts. (Amounts to be deducted should be Indicated with a minus sign.) Accounts Payable 1,120,000 S 9,750,000 Inventory Salee Initial amounts 1,400,000S Adjustments-increase (decrease): 1. 2. 3. 4. 5. 6. 7. Total adjustments Adjusted amounts 1,400,000 1,120,000 $ 9,750,000
Expert Solution
steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS