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Nov 4 7 9 11 Purchased $5,100 of merchandise on account from Salem Tire. Terms, 2/15, n/45, FOB shipping point. Salem Tire prepaid the $75 shipping cost and added the amount to the invoice. Purchased $100 of supplies on account from Staples Depot. Terms, 2/10, n/30, FOB destination. Sold $1,100 (cost, $400) of merchandise on account to D. Fraser. Terms, 3/15, n/45, FOB destination. Paid $50 freight charges to deliver goods to D. Fraser. 13 Returned $1,300 of the merchandise purchased on November 4 and received a credit. 15 Sold $1,500 (cost, $200) of merchandise to cash customers. 16 Paid for the supplies purchased on November 7. 18 Paid Salem Tire the amount due from the November 4 purchase in full. 20 D. Fraser returned $400 (cost, $200) of merchandise from the November 9 sale. 22 Purchased $3,500 of inventory. Paid cash. 23 Received payment in full from D. Fraser for the November 9 sale. 30 The refund liability for the month of November was estimated to be $200. The cost of goods estimated to be returned was $80.

Nov 4 7 9 11 Purchased $5,100 of merchandise on account from Salem Tire. Terms, 2/15, n/45, FOB shipping point. Salem Tire prepaid the $75 shipping cost and added the amount to the invoice. Purchased $100 of supplies on account from Staples Depot. Terms, 2/10, n/30, FOB destination. Sold $1,100 (cost, $400) of merchandise on account to D. Fraser. Terms, 3/15, n/45, FOB destination. Paid $50 freight charges to deliver goods to D. Fraser. 13 Returned $1,300 of the merchandise purchased on November 4 and received a credit. 15 Sold $1,500 (cost, $200) of merchandise to cash customers. 16 Paid for the supplies purchased on November 7. 18 Paid Salem Tire the amount due from the November 4 purchase in full. 20 D. Fraser returned $400 (cost, $200) of merchandise from the November 9 sale. 22 Purchased $3,500 of inventory. Paid cash. 23 Received payment in full from D. Fraser for the November 9 sale. 30 The refund liability for the month of November was estimated to be $200. The cost of goods estimated to be returned was $80.

FINANCIAL ACCOUNTING
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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Nov 4 Purchased $5,100 of merchandise on account from Salem Tire. Terms, 2/15, n/45, FOB shipping point. Salem Tire prepaid the $75 shipping cost and added the amount to the invoice. 7 Purchased $100 of supplies on account from Staples Depot. Terms, 2/10, n/30, FOB destination. Sold $1,100 (cost, $400) of merchandise on account to D. Fraser. Terms, 3/15, n/45, FOB destination. 9 11 Paid $50 freight charges to deliver goods to D. Fraser. 13 Returned $1,300 of the merchandise purchased on November 4 and received a credit. 15 Sold $1,500 (cost, $200) of merchandise to cash customers. 16 Paid for the supplies purchased on November 7. 18 Paid Salem Tire the amount due from the November 4 purchase in full. 20 D. Fraser returned $400 (cost, $200) of merchandise from the November 9 sale. 22 Purchased $3,500 of inventory. Paid cash. 23 Received payment in full from D. Fraser for the November 9 sale. 30 The refund liability for the month of November was estimated to be $200. The cost of goods estimated to be returned was $80. Requirements 1. Journalize the transactions on the books of Liberty Tire, Inc. assuming the "net" method is used. 2. What was Liberty Tire, Inc.'s gross profit for the month of November?
Transcribed Image Text:Nov 4 Purchased $5,100 of merchandise on account from Salem Tire. Terms, 2/15, n/45, FOB shipping point. Salem Tire prepaid the $75 shipping cost and added the amount to the invoice. 7 Purchased $100 of supplies on account from Staples Depot. Terms, 2/10, n/30, FOB destination. Sold $1,100 (cost, $400) of merchandise on account to D. Fraser. Terms, 3/15, n/45, FOB destination. 9 11 Paid $50 freight charges to deliver goods to D. Fraser. 13 Returned $1,300 of the merchandise purchased on November 4 and received a credit. 15 Sold $1,500 (cost, $200) of merchandise to cash customers. 16 Paid for the supplies purchased on November 7. 18 Paid Salem Tire the amount due from the November 4 purchase in full. 20 D. Fraser returned $400 (cost, $200) of merchandise from the November 9 sale. 22 Purchased $3,500 of inventory. Paid cash. 23 Received payment in full from D. Fraser for the November 9 sale. 30 The refund liability for the month of November was estimated to be $200. The cost of goods estimated to be returned was $80. Requirements 1. Journalize the transactions on the books of Liberty Tire, Inc. assuming the "net" method is used. 2. What was Liberty Tire, Inc.'s gross profit for the month of November?
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