Sales-Related Transactions using Perpetual Inventory System The following selected transactions were completed by Green Lawn Supplies Co., which sells irrigation supplies primarily to wholesalers and occasionally to retail customers: July 1. Sold merchandise on account to Landscapes Co., $33,450, terms FOB shipping point, n/eom. The cost of the goods sold was $20,000. 2. Sold merchandise for $86,000 plus 8% sales tax to retail cash customers. The cost of the goods sold was $51,600. 5. Sold merchandise on account to Peacock Company, $17,500, terms FOB destination, 1/10, n/30. The cost of the goods sold was $10,000. 8. Sold merchandise for $112,000 plus 8% sales tax to retail customers who used VISA cards. The cost of the goods sold was $67,200. 13. Sold merchandise to customers who used MasterCard cards, $96,000. The cost of the goods sold was $57,600. 14. Sold merchandise on account to Loeb Co., $16,000, terms FOB shipping point, 1/10, n/30. The cost of the goods sold was $9,000. 15. Received check for amount due from Peacock Company for sale on July 5. 16. Issued credit memo for $3,000 to Loeb Co. for merchandise returned from the sale on July 14. The cost of the merchandise returned was $1,800. 18. Sold merchandise on account to Jennings Company, $11,350, terms FOB shipping point, 2/10, n/30. Paid $475 for freight and added it to the invoice. The cost of the goods sold was $6,800. 24. Received check for amount due from Loeb Co. for sale on July 14 less credit memo of July 16. 28. Received check for amount due from Jennings Company for sale of July 18. 31. Paid Black Lab Delivery Service $8,550 for merchandise delivered during July to customers under shipping terms of FOB destination. 31. Received check for amount due from Landscapes Co. for sale of July 1. Aug. 3. Paid Hays Federal Bank $3,770 for service fees for handling MasterCard and VISA sales during July. 10. Paid $41,260 to state sales tax division for taxes owed on sales. Required: Journalize the entries to record the transactions of Green Lawn Supplies Co. For a compound transaction, if an amount box does not require an entry, leave the box blank. Date Account Debit Credit July 1-sale Date Account Debit Credit July 1-cost Date Account Debit Credit July 2-sale Date Account Debit Credit July 2-cost Date Account Debit Credit July 5-sale Date Account Debit Credit July 5-cost Date Account Debit Credit July 8-sale Date Account Debit Credit July 8-cost Date Account Debit Credit July 13-sale Date Account Debit Credit July 13-cost Date Account Debit Credit July 14-sale Date Account Debit Credit July 14-cost Date Account Debit Credit July 15 Date Account Debit Credit July 16-return Date Account Debit Credit July 16-cost Date Account Debit Credit July 18-sale Date Account Debit Credit July 18-freight Date Account Debit Credit July 18-cost Date Account Debit Credit July 24 Date Account Debit Credit July 28 Date Account Debit Credit July 31-freight Date Account Debit Credit July 31-collection Date Account Debit Credit Aug. 3 Date Account Debit Credit Aug. 10 12. PR.05-03B eBook Show Me How Sales-Related and Purchase-Related Transactions Using Perpetual Inventory System The following were selected from among the transactions completed by Essex Company during July of the current year: July 3. Purchased merchandise on account from Hamling Co., list price $72,000, trade discount 15%, terms FOB shipping point, 2/10, n/30, with prepaid freight of $1,450 added to the invoice. 5. Purchased merchandise on account from Kester Co., $33,450, terms FOB destination, 2/10, n/30. 6. Sold merchandise on account to Parsley Co., $36,000, terms n/15. The cost of the goods sold was $25,000. 7. Returned $6,850 of merchandise purchased on July 5 from Kester Co. 13. Paid Hamling Co. on account for purchase of July 3. 15. Paid Kester Co. on account for purchase of July 5, less return of July 7. 21. Received cash on account from sale of July 6 to Parsley Co. 21. Sold merchandise on MasterCard, $108,000. The cost of the goods sold was $64,800. 22. Sold merchandise on account to Tabor Co., $16,650, terms 2/10, n/30. The cost of the goods sold was $10,000. 23. Sold merchandise for cash, $91,200. The cost of the goods sold was $55,000. 28. Paid Parsley Co. a cash refund of $7,150 for returned merchandise from sale of July 6. The cost of the returned merchandise was $4,250. 31. Paid MasterCard service fee of $1,650. Required: Journalize the transactions. July 3 July 5 July 6-sale July 6-cost July 7 July 13 July 15 July 21 July 21-sale July 21-cost July 22-sale July 22-cost July 23-sale July 23-cost July 28-return July 28-cost July 31
Sales-Related Transactions using Perpetual Inventory System The following selected transactions were completed by Green Lawn Supplies Co., which sells irrigation supplies primarily to wholesalers and occasionally to retail customers: July 1. Sold merchandise on account to Landscapes Co., $33,450, terms FOB shipping point, n/eom. The cost of the goods sold was $20,000. 2. Sold merchandise for $86,000 plus 8% sales tax to retail cash customers. The cost of the goods sold was $51,600. 5. Sold merchandise on account to Peacock Company, $17,500, terms FOB destination, 1/10, n/30. The cost of the goods sold was $10,000. 8. Sold merchandise for $112,000 plus 8% sales tax to retail customers who used VISA cards. The cost of the goods sold was $67,200. 13. Sold merchandise to customers who used MasterCard cards, $96,000. The cost of the goods sold was $57,600. 14. Sold merchandise on account to Loeb Co., $16,000, terms FOB shipping point, 1/10, n/30. The cost of the goods sold was $9,000. 15. Received check for amount due from Peacock Company for sale on July 5. 16. Issued credit memo for $3,000 to Loeb Co. for merchandise returned from the sale on July 14. The cost of the merchandise returned was $1,800. 18. Sold merchandise on account to Jennings Company, $11,350, terms FOB shipping point, 2/10, n/30. Paid $475 for freight and added it to the invoice. The cost of the goods sold was $6,800. 24. Received check for amount due from Loeb Co. for sale on July 14 less credit memo of July 16. 28. Received check for amount due from Jennings Company for sale of July 18. 31. Paid Black Lab Delivery Service $8,550 for merchandise delivered during July to customers under shipping terms of FOB destination. 31. Received check for amount due from Landscapes Co. for sale of July 1. Aug. 3. Paid Hays Federal Bank $3,770 for service fees for handling MasterCard and VISA sales during July. 10. Paid $41,260 to state sales tax division for taxes owed on sales. Required: Journalize the entries to record the transactions of Green Lawn Supplies Co. For a compound transaction, if an amount box does not require an entry, leave the box blank. Date Account Debit Credit July 1-sale Date Account Debit Credit July 1-cost Date Account Debit Credit July 2-sale Date Account Debit Credit July 2-cost Date Account Debit Credit July 5-sale Date Account Debit Credit July 5-cost Date Account Debit Credit July 8-sale Date Account Debit Credit July 8-cost Date Account Debit Credit July 13-sale Date Account Debit Credit July 13-cost Date Account Debit Credit July 14-sale Date Account Debit Credit July 14-cost Date Account Debit Credit July 15 Date Account Debit Credit July 16-return Date Account Debit Credit July 16-cost Date Account Debit Credit July 18-sale Date Account Debit Credit July 18-freight Date Account Debit Credit July 18-cost Date Account Debit Credit July 24 Date Account Debit Credit July 28 Date Account Debit Credit July 31-freight Date Account Debit Credit July 31-collection Date Account Debit Credit Aug. 3 Date Account Debit Credit Aug. 10 12. PR.05-03B eBook Show Me How Sales-Related and Purchase-Related Transactions Using Perpetual Inventory System The following were selected from among the transactions completed by Essex Company during July of the current year: July 3. Purchased merchandise on account from Hamling Co., list price $72,000, trade discount 15%, terms FOB shipping point, 2/10, n/30, with prepaid freight of $1,450 added to the invoice. 5. Purchased merchandise on account from Kester Co., $33,450, terms FOB destination, 2/10, n/30. 6. Sold merchandise on account to Parsley Co., $36,000, terms n/15. The cost of the goods sold was $25,000. 7. Returned $6,850 of merchandise purchased on July 5 from Kester Co. 13. Paid Hamling Co. on account for purchase of July 3. 15. Paid Kester Co. on account for purchase of July 5, less return of July 7. 21. Received cash on account from sale of July 6 to Parsley Co. 21. Sold merchandise on MasterCard, $108,000. The cost of the goods sold was $64,800. 22. Sold merchandise on account to Tabor Co., $16,650, terms 2/10, n/30. The cost of the goods sold was $10,000. 23. Sold merchandise for cash, $91,200. The cost of the goods sold was $55,000. 28. Paid Parsley Co. a cash refund of $7,150 for returned merchandise from sale of July 6. The cost of the returned merchandise was $4,250. 31. Paid MasterCard service fee of $1,650. Required: Journalize the transactions. July 3 July 5 July 6-sale July 6-cost July 7 July 13 July 15 July 21 July 21-sale July 21-cost July 22-sale July 22-cost July 23-sale July 23-cost July 28-return July 28-cost July 31
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
Question
Sales-Related Transactions using Perpetual Inventory System
The following selected transactions were completed by Green Lawn Supplies Co., which sells irrigation supplies primarily to wholesalers and occasionally to retail customers:
| July 1. | Sold merchandise on account to Landscapes Co., $33,450, terms FOB shipping point, n/eom. The cost of the goods sold was $20,000. |
| 2. | Sold merchandise for $86,000 plus 8% sales tax to retail cash customers. The cost of the goods sold was $51,600. |
| 5. | Sold merchandise on account to Peacock Company, $17,500, terms FOB destination, 1/10, n/30. The cost of the goods sold was $10,000. |
| 8. | Sold merchandise for $112,000 plus 8% sales tax to retail customers who used VISA cards. The cost of the goods sold was $67,200. |
| 13. | Sold merchandise to customers who used MasterCard cards, $96,000. The cost of the goods sold was $57,600. |
| 14. | Sold merchandise on account to Loeb Co., $16,000, terms FOB shipping point, 1/10, n/30. The cost of the goods sold was $9,000. |
| 15. | Received check for amount due from Peacock Company for sale on July 5. |
| 16. | Issued credit memo for $3,000 to Loeb Co. for merchandise returned from the sale on July 14. The cost of the merchandise returned was $1,800. |
| 18. | Sold merchandise on account to Jennings Company, $11,350, terms FOB shipping point, 2/10, n/30. Paid $475 for freight and added it to the invoice. The cost of the goods sold was $6,800. |
| 24. | Received check for amount due from Loeb Co. for sale on July 14 less credit memo of July 16. |
| 28. | Received check for amount due from Jennings Company for sale of July 18. |
| 31. | Paid Black Lab Delivery Service $8,550 for merchandise delivered during July to customers under shipping terms of FOB destination. |
| 31. | Received check for amount due from Landscapes Co. for sale of July 1. |
| Aug. 3. | Paid Hays Federal Bank $3,770 for service fees for handling MasterCard and VISA sales during July. |
| 10. | Paid $41,260 to state sales tax division for taxes owed on sales. |
Required:
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 1-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 1-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 2-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 2-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 5-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 5-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 8-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 8-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 13-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 13-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 14-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 14-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 15 | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 16-return | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 16-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 18-sale | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 18-freight | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 18-cost | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 24 | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 28 | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 31-freight | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| July 31-collection | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| Aug. 3 | |||
| Date | Account | Debit | Credit |
|---|---|---|---|
| Aug. 10 | |||
12. PR.05-03B
eBook
Show Me How
Sales-Related and Purchase-Related Transactions Using Perpetual Inventory System
The following were selected from among the transactions completed by Essex Company during July of the current year:
| July 3. | Purchased merchandise on account from Hamling Co., list price $72,000, trade discount 15%, terms FOB shipping point, 2/10, n/30, with prepaid freight of $1,450 added to the invoice. |
| 5. | Purchased merchandise on account from Kester Co., $33,450, terms FOB destination, 2/10, n/30. |
| 6. | Sold merchandise on account to Parsley Co., $36,000, terms n/15. The cost of the goods sold was $25,000. |
| 7. | Returned $6,850 of merchandise purchased on July 5 from Kester Co. |
| 13. | Paid Hamling Co. on account for purchase of July 3. |
| 15. | Paid Kester Co. on account for purchase of July 5, less return of July 7. |
| 21. | Received cash on account from sale of July 6 to Parsley Co. |
| 21. | Sold merchandise on MasterCard, $108,000. The cost of the goods sold was $64,800. |
| 22. | Sold merchandise on account to Tabor Co., $16,650, terms 2/10, n/30. The cost of the goods sold was $10,000. |
| 23. | Sold merchandise for cash, $91,200. The cost of the goods sold was $55,000. |
| 28. | Paid Parsley Co. a cash refund of $7,150 for returned merchandise from sale of July 6. The cost of the returned merchandise was $4,250. |
| 31. | Paid MasterCard service fee of $1,650. |
Required:
Journalize the transactions.
| July 3 | |||
| July 5 | |||
| July 6-sale | |||
| July 6-cost | |||
| July 7 | |||
| July 13 | |||
| July 15 | |||
| July 21 | |||
| July 21-sale | |||
| July 21-cost | |||
| July 22-sale | |||
| July 22-cost | |||
| July 23-sale | |||
| July 23-cost | |||
| July 28-return | |||
| July 28-cost | |||
| July 31 |
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