Prepare journal entry to record the given transaction: (a) The date of declaration. (b) The date of issuance.

Question

Information pertaining to Noskey Corporation’s sales revenue follows: November 20X1 (Actual) December 20X1 (Budgeted) January 20X2 (Budgeted)Cash sales $ 115,000 $ 121,000 $ 74,000Credit sales 282,000 409,000 208,000Total sales $ 397,000 $ 530,000 $ 282,000Management estimates 5% of credit sales to be uncollectible. Of collectible credit sales, 60% is collected in the month of sale and the remainder in the month following the month of sale. Purchases of inventory each month include 70% of the next month’s projected total sales (stated at cost) plus 30% of projected sales for the current month (stated at cost). All inventory purchases are on account; 25% is paid in the month of purchase, and the remainder is paid in…

Answer 1

Question

Chapter 16, Problem 5P

1.

To determine

Prepare journal entry to record the given transaction:

(a) The date of declaration.

(b) The date of issuance.

2.

To determine

Calculate the balances in the shareholder’s equity accounts after the issuance are being made.

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