The following selected transactions were completed during April between Swan Company and Bird Company:Apr.2.Swan Company sold merchandise on account to Bird Company, $14,800, terms FOB shipping point, 2/10, n/30. Swan Company paid freight of $330, which was added to the invoice. The cost of the merchandise sold was $9,300.8.Swan Company sold merchandise on account to Bird Company, $23,000, terms FOB destination, 1/15, n/30. The cost of the merchandise sold was $13,800.8.Swan Company paid freight of $820 for delivery of merchandise sold to Bird Company on April 8.12.Bird Company paid Swan Company for purchase of April 2.18.Swan Company paid Bird Company a refund of $2,000 for defective merchandise in the April 2 purchase. Bird Company agreed to keep the merchandise.23.Bird Company paid Swan Company for purchase of April 8.24.Swan Company sold merchandise on account to Bird Company, $11,800, terms FOB shipping point, n/45. The cost of the merchandise sold was $7,100.26.Bird Company paid freight of $450 on April 24 purchase from Swan Company.30.Swan Company granted a customer allowance (credit memo) to Bird Company for $11,300 for merchandise that was returned from the August 24 purchase. The cost of the merchandise returned was $6,500. DateAccountDebitCreditApr.23Cash23,800Sales Discounts23,800DateAccountDebitCreditApr.24- Accounts Receivable-Bird Company11,800saleSales11,800DateAccountDebitCreditApr.24- Cost of Merchandise Sold7,100costMerchandise Inventory7,100DateAccountDebitCreditApr.Customer Refunds Payable3011,300Accounts Receivable-Bird Company11,300DateAccountDebitCreditAprг.Cash6,50030Merchandise Inventory6,500 2. Journalize the April transactions for Swan Company (the seller).DateAccountDebitCreditApr.2-Accounts Recelvable-Bird Company14,800saleCash14,800DateAccountDebitCreditApr.2-Accounts Receivable-Bird Company330freightCash330DateAccountDebitCreditApr.2-Cost of Merchandise Sold9,300costMerchandise Inventory9,300DateAccountDebitCreditApr.8-Accounts Receivable-Bird Company23,000saleSales23,000DateAccountDebitCreditApr.8-Cost of Merchandise Sold13,800costMerchandise Inventory13,800DateAccountDebitCreditApr.8-Delivery Expense820freightCash820DateAccountDebitCreditАpr. 12Sales14,800Accounts Receivable-Bird Company14,800DateAccountDebitCreditApr.Merchandise Iventory2,00018Merchandise Inventory2,000

COST OF GOODS SOLD: Cost of Goods Sold refers to an income statement account that summates all the direct materials, direct labor, and manufacturing overhead involved during the manufacturing process of certain merchandise. Furthermore, it is classified as an expense account, thereby this item should be deducted from the net sales amount in order to arrive with the gross profit figure.Bird Company (Buyer) Date Account Titles Debit Credit Apr-02 Merchandise Inventory 15,130 Accounts Payable 15,130 Apr-08 Merchandise Inventory 23,000 Accounts Payable 23,000 Apr-08 No entry Apr-12 Accounts Payable 15,130 Cash 14,834 Merchandise Inventory 296 Apr-18 Cash 2,000 Merchandise Inventory 2,000 Apr-23 Accounts Payable 23,000 Cash 22,770 Merchandise Inventory 230 Apr-24 Merchandise Inventory 11,800 Accounts Payable 11,800 Apr-26 Merchandise Inventory 450 Cash 450 Apr-30 Accounts Payable 11,300 Merchandise Inventory 11,300 Swan Company (Seller) Date Account Titles Debit Credit Apr-02 Accounts Receivable 15,130 Sales Revenue 14,800 Cash 330 Cost of Goods Sold 9,300 Merchandise Inventory 9,300 Apr-08 Accounts Receivable 23,000 Sales Revenue 23,000 Cost of Goods Sold 13,800 Merchandise Inventory 13,800 Apr-08 Delivery Expense 820 Cash 820 Apr-12 Cash 14,834 Sales Discounts 296 Accounts Receivable 15,130 Apr-18 Sales Returns and allowances 2,000 Cash 2,000 Apr-23 Cash 22,770 Sales Discounts 230 Accounts Receivable 23,000 Apr-24 Accounts Receivable 11,800 Sales Revenue 11,800 Cost of Goods Sold 7,100 Merchandise Inventory 7,100 Apr-26 No entry Apr-30 Sales Returns and allowances 11,800 Accounts Receivable 11,800 Merchandise Inventory $ 6,500 Cost of Goods Sold $ 6,500

The following selected transactions were completed during April between Swan Company and Bird Company: Apr.2. Swan Company sold merchandise on account to Bird Company, $14,800, terms FOB shipping point, 2/10, n/30. Swan Company paid freight of $330, which was added to the invoice. The cost of the merchandise sold was $9,300. 8. Swan Company sold merchandise on account to Bird Company, $23,000, terms FOB destination, 1/15, n/30. The cost of the merchandise sold was $13,800. 8. Swan Company paid freight of $820 for delivery of merchandise sold to Bird Company on April 8. 12. Bird Company paid Swan Company for purchase of April 2. 18. Swan Company paid Bird Company a refund of $2,000 for defective merchandise in the April 2 purchase. Bird Company agreed to keep the merchandise. 23. Bird Company paid Swan Company for purchase of April 8. 24. Swan Company sold merchandise on account to Bird Company, $11,800, terms FOB shipping point, n/45. The cost of the merchandise sold was $7,100. 26. Bird Company paid freight of $450 on April 24 purchase from Swan Company. 30. Swan Company granted a customer allowance (credit memo) to Bird Company for $11,300 for merchandise that was returned from the August 24 purchase. The cost of the merchandise returned was $6,500.

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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Apr.2.	Swan Company sold merchandise on account to Bird Company, $14,800, terms FOB shipping point, 2/10, n/30. Swan Company paid freight of $330, which was added to the invoice. The cost of the merchandise sold was $9,300.
8.	Swan Company sold merchandise on account to Bird Company, $23,000, terms FOB destination, 1/15, n/30. The cost of the merchandise sold was $13,800.
8.	Swan Company paid freight of $820 for delivery of merchandise sold to Bird Company on April 8.
12.	Bird Company paid Swan Company for purchase of April 2.
18.	Swan Company paid Bird Company a refund of $2,000 for defective merchandise in the April 2 purchase. Bird Company agreed to keep the merchandise.
23.	Bird Company paid Swan Company for purchase of April 8.
24.	Swan Company sold merchandise on account to Bird Company, $11,800, terms FOB shipping point, n/45. The cost of the merchandise sold was $7,100.
26.	Bird Company paid freight of $450 on April 24 purchase from Swan Company.
30.	Swan Company granted a customer allowance (credit memo) to Bird Company for $11,300 for merchandise that was returned from the August 24 purchase. The cost of the merchandise returned was $6,500.