Read the following information to answer questions 2.1 - 2.2.LA Fashion has credit sales of $6,400,000 for the financial year ending June 30, 2021, and estimates at the end of the financial year that five per cent of accounts receivable will not be received. Accounts receivable total $3,100,000. The corporation uses the allowance method to account for bad debts, based on the percentage of receivables approach. **Question 2.5:**On April 15, LA Fashion purchased $15,000 of inventory on account. The shirts were purchased on the credit terms 4/10, n/30. LA Fashion paid for the shirts on April 20. Record the journal entry for LA Fashion to recognize the payment of the inventory on April 20 (recall that LA Fashion uses the periodic inventory system):**Journal Entry Details:**- **Debit:** [Select] $15,000- **Credit: Cash** $ [Select]- **Credit:** [Select] $ [Select]

Solution 2.5: Journal entry to recognize payment on 20 April is as und

On April 15 LA Fashion purchased $15,000 of inventory on account. The shirts were purchased on the credit terms 4/10, n/30. LA Fashion paid for the shirts on 20 April. Record the journal entry for LA Fashion to recognise the payment of the inventory on 20 April (recall that LA Fashion uses the periodic inventory system): Debit: [ Select ] $15,000

On April 15 LA Fashion purchased $15,000 of inventory on account. The shirts were purchased on the credit terms 4/10, n/30. LA Fashion paid for the shirts on 20 April. Record the journal entry for LA Fashion to recognise the payment of the inventory on 20 April (recall that LA Fashion uses the periodic inventory system): Debit: [ Select ] $15,000

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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