Q3. Lamprino Appliance uses a perpetual inventory system. The following are three recent merchandising transactions: 1. June 10 Purchased 10 televisions from Mitsu Industries on account. Invoice price, $300 per unit, for a total of $3,000. The terms of purchase were 2/10, n/30. 2. June 15 Sold one of these televisions for $450 cash. 3. June 20 Paid the account payable to Mitsu Industries within the discount period. Requirements a. Prepare journal entries to record these transactions assuming that Lamprino records purchases of merchandise at: 1. Net cost 2. Gross invoice price b. Assume that Lamprino did not pay Mitsu Industries within the discount period but instead paid the full invoice price on July 10. Prepare journal entries to record this payment assuming that the original liability had been recorded at: 1. Net cost 2. Gross invoice price

Q3. Lamprino Appliance uses a perpetual inventory system. The following are three recent merchandising transactions: 1. June 10 Purchased 10 televisions from Mitsu Industries on account. Invoice price, $300 per unit, for a total of $3,000. The terms of purchase were 2/10, n/30. 2. June 15 Sold one of these televisions for $450 cash. 3. June 20 Paid the account payable to Mitsu Industries within the discount period. Requirements a. Prepare journal entries to record these transactions assuming that Lamprino records purchases of merchandise at: 1. Net cost 2. Gross invoice price b. Assume that Lamprino did not pay Mitsu Industries within the discount period but instead paid the full invoice price on July 10. Prepare journal entries to record this payment assuming that the original liability had been recorded at: 1. Net cost 2. Gross invoice price

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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Part 1: Consider the following perpetual system merchandising transactions of Belton Company. Use a separate account for each receivable and payable; for example, record the sale on June 1 in Accounts Receivable-Avery & Wiest. June 1 Sold merchandise to Avery & Wiest for $9,450; terms 2/5, n/15, FOB destination (cost of sales $6,600). 2 Purchased $4,850 of merchandise from Angolac Suppliers; terms 2/10, n/20, FOB shipping point. 4 Purchased merchandise inventory from Bastille Sales for $11,300; terms 2/15, n/45, FOB Bastille Sales. 5 Sold merchandise to Gelgar for $10,900; terms 3/5, n/15, FOB destination (cost of sales $7,650). 6 Collected the amount owing from Avery & Wiest regarding the June 1 sale. 12 Paid Angolac Suppliers for the June 2 purchase. 20 Collected the amount owing from Gelgar regarding the June 5 sale.. 30 Paid Bastille Sales for the June 4 purchase. Prepare General Journal entries to record the above transactions.
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