Sept. 1 Oct. 1 Oct. 1 (a) Purchased inventory from Encino Company on account for $46,800. Crane records purchases gross and uses a periodic inventory system. Issued a $46,800, 12-month, 8% note to Encino in payment of account. Borrowed $46,800 from the Shore Bank by signing a 12-month, zero-interest-bearing $49,920 note. Prepare journal entries for the selected transactions above. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record entries in the order displayed in the problem statement.) Date October 1 Account Titles and Explanation Debit T Credit

Sept. 1 Oct. 1 Oct. 1 (a) Purchased inventory from Encino Company on account for $46,800. Crane records purchases gross and uses a periodic inventory system. Issued a $46,800, 12-month, 8% note to Encino in payment of account. Borrowed $46,800 from the Shore Bank by signing a 12-month, zero-interest-bearing $49,920 note. Prepare journal entries for the selected transactions above. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record entries in the order displayed in the problem statement.) Date October 1 Account Titles and Explanation Debit T Credit

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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ok nces Bryant Company sells a wide range of inventories, which are initially purchased on account. Occasionally, short-term notes payable are used to obtain cash for current use. The following transactions were selected from those occurring during the year. a. On January 10, purchased merchandise on credit for $21,000. The company uses a perpetual inventory system. b. On March 1, borrowed $46,000 cash from City Bank and signed a promissory note with a face amount of $46,000, due at the end of six months, accruing interest at an annual rate of 6.50 percent, payable at maturity, Required: 1. For each of the transactions, indicate the accounts, amounts, and effects on the accounting equation 2. What amount of cast, is paid on the maturity date of the note? 3. Indicate the impact of each transaction (increase, decrease, and no effect) on the debt-to-assets ratio. Assume Bryant Company had $360,000 in total liabilities and $560,000 in total assets, yielding a debt-to-assets ratio of 0.64,…
Shankar Company uses a periodic system to record inventory transactions. The company purchases inventory on account on February 2 for $37,000, with terms 3/10, n/30. On February 10, the company pays on account for the inventory. Record the inventory purchase on February 2 and the payment on February 10. Note: If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. View transaction list Journal entry worksheet P 2 Record the purchase of inventory on account. Note: Enter debits before credits. Date February 02 Record entry General Journal Clear entry Debit Credit View general journal
Jan. 2 Purchased merchandise on account from Nunez Company, $27,600, terms 3/10, n/30. (Wildhorse uses the perpetual inventory system.) 1 Issued a 9%, 2-month, $27,600 note to Nunez in payment of account. Feb. Mar. 31 Accrued interest for 2 months on Nunez note. Apr. 1 Paid face value and interest on Nunez note. July 1 Purchased equipment from Marson Equipment paying $10,200 in cash and signing a 10%, 3-month, $68,400 note. Sept. 30 Accrued interest for 3 months on Marson note. Oct. 1 Paid face value and interest on Marson note. Dec. 1 Borrowed $27,600 from the Paola Bank by issuing a 3-month, 8% note with a face value of $27,600. Dec. 31 Recognized interest expense for 1 month on Paola Bank note. Prepare Journal entries for the listed transactions and events. Post the accounts Notes Payable, Interest payable, and Interest Expense. Show the balance sheet presentation of notes and interest payable at December 31. What is the total interest expense for the year?
On July 1, Hernandez, Inc. purchased merchandise for $2,500, with terms of 1/10, n/30. On July 5, the firm returned $1 ,000 of the merchandise to the seller. Payment of the account occurred on July 8. Hernandez uses the perpetual inventory system. a. Prepare the journal entries for July 1, July 5, and July 8. b. Assuming that the account was paid on July 14, prepare the journal entry for payment on that date.
Purchase-Related Transactions The Stationery Company purchased merchandise on account from a supplier for $17,400, terms 1/10, n/30. The Stationery Company returned merchandise with an invoice amount of $2,300 and received full credit. a. If The Stationery Company pays the invoice within the discount period, what is the amount of cash required for the payment? b. Under a perpetual inventory system, what account is credited by The Stationery Company to record the return?
Recording Inventory Purchases and Sales on Account Record the entries for the following transactions for Shoppers Inc. Shoppers uses a perpetual inventory system and records sales taxes payable at the point of sale. a. On January 1, 2020, Shoppers Inc. purchased merchandise for resale for $56,000 on credit terms 1/15, n/30. Shoppers Inc. incurred a shipping charge of $288 on the purchase, which was immediately paid. Shoppers Inc. uses the gross method to record purchases. b. Shoppers Inc. sells $22,400 of inventory during the first week of January 2020, to customers for $40,000, with a sales tax rate of 5%. Of the total sales for the week, 30% are cash sales, and 70% are credit sales (n/30). c. On January 14, 2020, Shoppers Inc. pays the balance for purchases on account. d. Assume instead that Shoppers Inc. sells $24,000 of inventory during the first week of January 2020 to customers for $44,800, which includes a 5% sales tax. Of the total sales for the week, 30% are cash sales, and…
On December 22, Travis Company purchased merchandise on account from a supplier for $7,500, terms 2/10, net 30. Travis Company paid for the merchandise within the discount period on December 31. Required: Under a perpetual inventory system, record the journal entries required for the above transactions. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS Travis Company General Ledger ASSETS 110 Cash 120 Accounts Receivable 125 Notes Receivable 130 Merchandise Inventory 131 Estimated Returns Inventory 140 Supplies 142 Prepaid Insurance 180 Land 190 Equipment 191 Accumulated Depreciation LIABILITIES 210 Accounts Payable 216 Salaries Payable 221 Sales Tax Payable 222 Customers Refunds Payable 231 Unearned Rent 241 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends 313 Income Summary REVENUE…
Jan. SPurchased merchandise on account at a cost of 14,000. (Assume a perpetual inventory system.) 17Paid for the January 8 purchase. Apr.Received 40,000 from National Bank after signing a 12-month, 6 percent, promissory 1note. June Purchased merchandise on account at a cost of 18,000. July 5Paid for the June 3 purchase. Aug Rented out a small office in a building owned by Company and collected six months rent 1in advance amounting to 6,000. (Use an account called Unearned Rent Revenue.) Dec.Received a 100 deposit from a customer as a guarantee to return a large trailer borrowed 20 for 30 days. TIP: Consider whether Company has an obligation to return the money when the trailer is returned. Dec.Determined that wages of 6,500 were earned but not yet paid on December 31 (ignore 31payroll taxes). Dec-Adjusted the accounts at year-end, relating to interest. 31 Dec. Adjusted the accounts at year-end, relating to rent. 31 Required: 1.Prepare journal entries for each of the transactions. (If…
A credit records financial informati. A. January 22, purchased, an asset, merchandise inventory on account for $2,800. EA7. Prepare journal entries to record the following transactions. will increase and the other side will- the terms debit and credit representedi- by calculating the difference between ectively. Depending on the acc 1. January 22, purchased, an asset merchandise inventory on account for $2,800. B. February 10, paid creditor for part of January 22 purchase, $1,600 C. July 1, issued common stock for cash, $15,000 D. July 15, purchased supplies, on account, $1,800 E. July 25, billed customer for accounting services provided, $950 BAT. Prepare journal entries to record the following transactions.
On December 29 of the current year, Sabre Company sold merchandise for $4, 000 on credit terms, 3/10, n/60. Its accounting period ends December 31. Required Provide the following entries under the gross method. a. To record the merchandise sale. Omit the cost of goods sold entry. b. To record collection of the account, assuming collection took place on January 5 of next year. c. To record collection of the account, assuming collection took place on February 15 of next year. Note: If a line in a journal entry isn't required for a transaction, select "N/A" as the account name and leave the Dr. or Cr. answer blank (zero). 0
Purchases Transactions Barans Company purchased merchandise on account from Springhill Company for $12,400, terms 1/10, n/30. Barans returned merchandise with an invoice amount of $1,900 and received full credit. a. If Barans Company pays the invoice within the discount period, what is the amount of cash required for the payment? If required, round the answer to the nearest dollar.
Instructions The following items were selected from among the transactions completed by Sherwood Co. during the current year: Mar. Apr. Jun. Jul. Aug. Dec. 1 Purchased merchandise on account from Kirkwood Co., $390,000, terms n/30. 31 Issued a 30-day, 10% note for $390,000 to Kirkwood Co., on account. 30 Paid Kirkwood Co. the amount owed on the note of March 31. 1 Borrowed $156,000 from Triple Creek Bank, issuing a 45-day, 8% note. 1 Purchased tools by issuing a $216,000, 60-day note to Poulin Co., which discounted the note at the rate of 6%. 16 15 Paid Triple Creek Bank the amount due on the note of July 16. 30 Paid Poulin Co. the amount due on the note of July 1. 1 Purchased equipment from Greenwood Co. for $500,000, paying $150,000 cash and issuing a series of ten 8% notes for $35,000 each, coming due at 30-day intervals. Settled a product liability lawsuit with a customer for $310,000, payable in January. Accrued the loss in a litigation claims payable account. Paid the amount due…