Explanation Record the journal entry for the sale of inventory on account. Date Accounts and Explanation Debit ($) Credit ($) January 4 Accounts Receivable 16,000 To Sales Revenue 16,000 (To record the sale of inventory on account) Table (1) Accounts Receivable is an asset and it is increased by $16,000. Therefore, debit account receivable with $16,000. Sales revenue is revenue and it increases the value of equity by $16,000. Therefore, credit sales revenue with $16,000. Record the journal entry for cost of goods sold. Date Accounts and Explanation Debit ($) Credit ($) January 4 Cost of Goods Sold 8,000 Merchandise Inventory 8,000 (To record the cost of goods sold) Table (2) Cost of goods sold is an expense account and it decreases the value of equity by $8,000. Therefore, debit cost of goods sold account with $8,000. Merchandise Inventory is an asset and it is decreased by $8,000. Therefore, credit inventory account with $8,000. Record the journal entry for sales return. Journal Entry Date Account Title and Explanation Post Ref. Debit ($) Credit ($) January 8 Sales Returns and Allowances 300 Accounts Receivable 300 (To record sales returns) Table (3) Sales return and allowance is an expense account and it decreases the value of equity by $300. Therefore, debit sales returns and allowances account with $300. Accounts Receivable is an asset and it is decreased by $300. Therefore, credit account receivable with $300. Record the journal entry for the return of the merchandise. Date Accounts and Explanation Debit ($) Credit ($) January 8 Merchandise Inventory 150 Cost of Goods Sold 150 (To record the return of the merchandise) Table (4) Merchandise Inventory is an asset and it is increased by $150. Therefore, debit inventory account with $150. Cost of goods sold is an expense account and it increases the value of equity by $150. Therefore, credit cost of goods sold account with $150. Record the journal entry for the balance amount received. Journal Entry Date Account Title and Explanation Post Ref. Debit ($) Credit ($) January 13 Cash 15,700 Accounts Receivable 15,700 (1) (To record cash received and discounts allowed) Table (5) Working Notes: Calculate accounts receivable amount. Accounts receivable due to sales = $16,000 Sales return = $300 Accounts receivable balance } = { Accounts receivable due to sales – Sales returns } = $16,000 – $300 = $15,700 (1) Cash is an asset and it is increased by $15,700

Horngren's Financial & Managerial Accounting, The Managerial Chapters, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)

6th Edition

ISBN: 9780134642871

Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura

Publisher: PEARSON

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Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business…

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Chapter 5, Problem 5.21E

To determine

Sales is an activity of selling the merchandise inventory of a business.

To Record: The sale transactions of Mall A.

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Chapter 5, Problem 5.20E

Chapter 5, Problem 5.22E

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Chapter 5 Solutions

Horngren's Financial & Managerial Accounting, The Managerial Chapters, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)

Ch. 5 - Which account does a merchandiser use that a...Ch. 5 - The two main inventory accounting systems are the...Ch. 5 - The journal entry for the purchase of inventory on...Ch. 5 - JC Manufacturing purchase d inventory for 5,300...Ch. 5 - 5. Austin Sound sold inventory for $300,000, terms...Ch. 5 - Suppose Daves Discounts Merchandise Inventory...Ch. 5 - Which of the following accounts would be closed at...Ch. 5 - What is the order of the subtotals that appear on...Ch. 5 - Prob. 9QC Ch. 5 - Prob. 10QC

Ch. 5 - The journal entry for the purchase of inventory on...Ch. 5 - What is a merchandiser, and what is the name of...Ch. 5 - Prob. 2RQ Ch. 5 - Describe the operating cycle of a merchandiser.Ch. 5 - What is Cost of Goods Sold (COGS), and where is it...Ch. 5 - How is gross profit calculated, and what does it...Ch. 5 - What are the two types of inventory accounting...Ch. 5 - What is an invoice?Ch. 5 - What account is debited when recording a purchase...Ch. 5 - Prob. 9RQ Ch. 5 - What is a purchase return? How does a purchase...Ch. 5 - Prob. 11RQ Ch. 5 - How is the net cost of inventory calculated?Ch. 5 - What are the two journal entries involved when...Ch. 5 - Prob. 14RQ Ch. 5 - Prob. 15RQ Ch. 5 - When granting a sales allowance, is there a return...Ch. 5 - Prob. 17RQ Ch. 5 - Prob. 18RQ Ch. 5 - What are the four steps involved in the closing...Ch. 5 - Prob. 20RQ Ch. 5 - Prob. 21RQ Ch. 5 - Prob. 22RQ Ch. 5 - Prob. 23RQ Ch. 5 - Prob. 24RQ Ch. 5 - Prob. 25RQ Ch. 5 - When recording purchase returns and purchase...Ch. 5 - What account is debited when recording the payment...Ch. 5 - Prob. 28RQ Ch. 5 - Is an adjusting entry needed for inventory...Ch. 5 - Highlight the differences in the closing process...Ch. 5 - Describe the calculation of cost of goods sold...Ch. 5 - Comparing periodic and perpetual inventory systems...Ch. 5 - S5-2 Journalizing purchase transactions Consider...Ch. 5 - Prob. 5.3SE Ch. 5 - Prob. 5.4SE Ch. 5 - Prob. 5.5SE Ch. 5 - Prob. 5.6SE Ch. 5 - Prob. 5.7SE Ch. 5 - Prob. 5.8SE Ch. 5 - S5-9 Journalizing closing entries Rocky RV...Ch. 5 - Prob. 5.10SE Ch. 5 - Prob. 5.11SE Ch. 5 - Prob. 5.12SE Ch. 5 - Prob. 5.13SE Ch. 5 - Prob. 5.14SE Ch. 5 - Prob. 5.15SE Ch. 5 - Prob. 5.16SE Ch. 5 - Prob. 5.17SE Ch. 5 - Prob. 5.18E Ch. 5 - Prob. 5.19E Ch. 5 - Prob. 5.20E Ch. 5 - Prob. 5.21E Ch. 5 - Prob. 5.22E Ch. 5 - Prob. 5.23E Ch. 5 - Prob. 5.24E Ch. 5 - Prob. 5.25E Ch. 5 - Prob. 5.26E Ch. 5 - Prob. 5.27E Ch. 5 - Prob. 5.28E Ch. 5 - Prob. 5.29E Ch. 5 - Prob. 5.30E Ch. 5 - Prob. 5.31E Ch. 5 - E5B-32 Journalizing closing entries—periodic...Ch. 5 - E5B-33 Computing cost of goods sold in a periodic...Ch. 5 - Prob. 5.34AP Ch. 5 - P5-35A Journalizing purchase and sale...Ch. 5 - Prob. 5.36AP Ch. 5 - Prob. 5.37AP Ch. 5 - Prob. 5.38AP Ch. 5 - Prob. 5.39AP Ch. 5 - Prob. 5.40AP Ch. 5 - Prob. 5.41BP Ch. 5 - Prob. 5.42BP Ch. 5 - Prob. 5.43BP Ch. 5 - Prob. 5.44BP Ch. 5 - Prob. 5.45BP Ch. 5 - Prob. 5.46BP Ch. 5 - Prob. 5.47BP Ch. 5 - Prob. 49CP Ch. 5 - Prob. 50CP Ch. 5 - P5-51 Journalizing purchase and sale transactions,...Ch. 5 - Prob. 5.1TI Ch. 5 - Prob. 5.1DC Ch. 5 - Dobbs Wholesale Antiques makes all sales under...Ch. 5 - Rae Philippe was a warehouse manager for Atkins...Ch. 5 - Prob. 5.1FSC

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Sales is an activity of selling the merchandise inventory of a business. To Record: The sale transactions of Mall A.