On March 1, Showcase Co., a furniture wholesaler, sells merchandise to Balboa Co. on account, $254,500, terms n/30. The cost of the merchandise sold is $152,700. Showcase Co. issues a credit memo on March 5 for $30,000 as a price adjustment prior to Balboa Co. paying the original invoice on March 29. Journalize Showcase Co.’s entries for (a) the sale, including the cost of the merchandise sold; (b) the credit memo; and (c) the receipt of the check for the amount due from Balboa Co.
On March 1, Showcase Co., a furniture wholesaler, sells merchandise to Balboa Co. on account, $254,500, terms n/30. The cost of the merchandise sold is $152,700. Showcase Co. issues a credit memo on March 5 for $30,000 as a price adjustment prior to Balboa Co. paying the original invoice on March 29. Journalize Showcase Co.’s entries for (a) the sale, including the cost of the merchandise sold; (b) the credit memo; and (c) the receipt of the check for the amount due from Balboa Co.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On March 1, Showcase Co., a furniture wholesaler, sells merchandise to Balboa Co. on account, $254,500, terms n/30. The cost of the merchandise sold is $152,700. Showcase Co. issues a credit memo on March 5 for $30,000 as a price adjustment prior to Balboa Co. paying the original invoice on March 29.
Journalize Showcase Co.’s entries for (a) the sale, including the cost of the merchandise sold; (b) the credit memo; and (c) the receipt of the check for the amount due from Balboa Co. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
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