Financial Accounting
3rd Edition
ISBN: 9780078025549
Author: J. David Spiceland, Wayne M Thomas, Don Herrmann
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 6, Problem 6.3BP
1.
To determine
To record: The transactions of the Company CD for the month of June using perpetual inventory system.
2.
To determine
To prepare: The top section of the multi-step income statement through gross profit for the month of June.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Prepare the necessary general journal entries for the month of October for Wildhorse Retail for each situation given below. Wildhorse uses a perpetual inventory system. List all debit entries before credit entries.)
Oct. 5
Paid cash of $15,372 for operating expenses that were incurred and properly recorded in the previous period.
9
Purchased merchandise for $27,000 on account. Credit terms: 3/10, n/30.
12
Paid a freight bill of $130 for merchandise purchased on October 9.
17
Paid for merchandise purchased on October 9. The company takes all discounts to which it is entitled.
20
Sold merchandise for $9,760 to Rattles Distribution on account. The cost of the merchandise sold was $3,904. Credit terms: 2/10, n/30.
26
Issued a credit memo to Rattles Distribution for $366 for merchandise returned from the sale on October 20. The cost of the merchandise returned was $228.
Recording Purchase Transactions
Jeet Company and Reece Company use the perpetual inventory system. The following transactions occurred during the month of April.
On April 1, Jeet purchased merchandise on account from Reece with credit terms of 2/10, n/30. The selling price of the merchandise was $3,100, and the cost of the merchandise sold was $2,225.
On April 1, Jeet paid freight charges of $250 cash to have the goods delivered to its warehouse.
On April 8, Jeet returned $800 of the merchandise. The cost of the merchandise returned was $500.
On April 10, Jeet paid Reece the balance due.
Required:
1. Prepare the journal entries to record the April 1 purchase of merchandise and payment of freight by Jeet.
2. Prepare the journal entry to record the April 8 return of merchandise by Jeet.
3. Prepare the journal entry to record the April 10 payment to Reece by Jeet. For a compound transaction, if those boxes in which no entry is required, leave the box blank.
Recording Purchase Transactions
Jeet Company and Reece Company use the perpetual inventory system. The following transactions occurred during the month of April:
On April 1, Jeet purchased merchandise on account from Reece with credit terms of 2/10, n/30. The selling price of the merchandise was $3,100, and the cost of the merchandise sold was $2,225.
On April 1, Jeet paid freight charges of $250 cash to have the goods delivered to its warehouse.
On April 8, Jeet returned $800 of the merchandise. The cost of the merchandise returned was $500.
On April 10, Jeet paid Reece the balance due.
Assume that Jeet uses a periodic inventory system.
Required:
1. Prepare the journal entry to record the April 1 purchase of merchandise and payment of freight by Jeet.
2. Prepare the journal entry to record the April 8 return of merchandise.
3. Prepare the journal entry to record the April 10 payment to Reece. For those boxes in which no entry is required, leave the box blank.
Chapter 6 Solutions
Financial Accounting
Ch. 6 - Prob. 1RQCh. 6 - Prob. 2RQCh. 6 - What is the difference among raw materials...Ch. 6 - Prob. 4RQCh. 6 - Prob. 5RQCh. 6 - What is a multiple-step income statement? What...Ch. 6 - Cheryl believes that companies report cost of...Ch. 6 - What are the three primary cost flow assumptions?...Ch. 6 - 9.Which cost flow assumption generally results in...Ch. 6 - Prob. 10RQ
Ch. 6 - Prob. 11RQCh. 6 - 12.Explain how LIFO generally results in lower...Ch. 6 - Prob. 13RQCh. 6 - Explain how freight charges, purchase returns, and...Ch. 6 - Prob. 15RQCh. 6 - Prob. 16RQCh. 6 - Prob. 17RQCh. 6 - Prob. 18RQCh. 6 - Prob. 19RQCh. 6 - How is gross profit calculated? What is the gross...Ch. 6 - 21.Explain how the sale of inventory on account is...Ch. 6 - Prob. 22RQCh. 6 - Prob. 23RQCh. 6 - Prob. 24RQCh. 6 - Prob. 6.1BECh. 6 - Prob. 6.2BECh. 6 - Calculate cost of goods sold (LO62) At the...Ch. 6 - Prob. 6.4BECh. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Prob. 6.8BECh. 6 - Identify financial statement effects of FIFO and...Ch. 6 - Prob. 6.10BECh. 6 - Prob. 6.11BECh. 6 - Prob. 6.12BECh. 6 - Prob. 6.13BECh. 6 - Prob. 6.14BECh. 6 - Prob. 6.15BECh. 6 - Prob. 6.16BECh. 6 - Prob. 6.17BECh. 6 - Prob. 6.18BECh. 6 - Prob. 6.19BECh. 6 - Prob. 6.20BECh. 6 - Prob. 6.21BECh. 6 - Prob. 6.22BECh. 6 - Calculate cost of goods sold (LO62) Russell Retail...Ch. 6 - Prob. 6.2ECh. 6 - Prob. 6.3ECh. 6 - Calculate inventory amounts when costs are rising...Ch. 6 - Calculate inventory amounts when costs are...Ch. 6 - Record Inventory transactions using o perpetual...Ch. 6 - Record inventory purchase and purchase return...Ch. 6 - Prob. 6.8ECh. 6 - Prob. 6.9ECh. 6 - Prob. 6.10ECh. 6 - Record transactions using a perpetual system...Ch. 6 - Record transactions using a perpetual system...Ch. 6 - Prob. 6.13ECh. 6 - Prob. 6.14ECh. 6 - Calculate cost of goods sold, the inventory...Ch. 6 - Prob. 6.16ECh. 6 - Prob. 6.17ECh. 6 - Prob. 6.18ECh. 6 - Record inventory purchases and sales using a...Ch. 6 - Prob. 6.20ECh. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Prob. 6.2APCh. 6 - Prob. 6.3APCh. 6 - Prob. 6.4APCh. 6 - Prob. 6.5APCh. 6 - Prob. 6.6APCh. 6 - Prob. 6.7APCh. 6 - Prob. 6.8APCh. 6 - Record transactions and prepare a partial income...Ch. 6 - Prob. 6.10APCh. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Prob. 6.2BPCh. 6 - Prob. 6.3BPCh. 6 - Prob. 6.4BPCh. 6 - Prob. 6.5BPCh. 6 - Prob. 6.6BPCh. 6 - Prob. 6.7BPCh. 6 - Use the inventory turnover retio end gross profit...Ch. 6 - Record transactions and prepare a partial income...Ch. 6 - Prob. 6.10BPCh. 6 - Prob. 6.1APCPCh. 6 - Prob. 6.2APFACh. 6 - Prob. 6.3APFACh. 6 - Prob. 6.4APCACh. 6 - Prob. 6.5APECh. 6 - Prob. 6.6APIRCh. 6 - Written Communication You have just been hired as...Ch. 6 - Prob. 6.8APEM
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Palisade Creek Co. is a retail business that uses the perpetual inventory system. The account balances for Palisade Creek as of May 1, 20Y6 (unless otherwise indicated), are as follows: During May, the last month of the fiscal year, the following transactions were completed: Record the following transactions on Page 21 of the journal: Instructions 1. Enter the balances of each of the accounts in the appropriate balance column of a four-column account. Write Balance in the item section, and place a check mark () in the Posting Reference column. Journalize the transactions for May, starting on Page 20 of the journal. 2. Post the journal to the general ledger, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers. 3. Prepare an unadjusted trial balance. 4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete (5) and (6). 5. (Optional) Enter the unadjusted trial balance on a 10-column end-of-period spreadsheet (work sheet), and complete the spreadsheet. 6. Journalize and post the adjusting entries. Record the adjusting entries on Page 22 of the journal. 7. Prepare an adjusted trial balance. 8. Prepare an income statement, a statement of stockholders equity, and a balance sheet. Assume that additional common stock of 10,000 was issued in January 20Y6. 9. Prepare and post the closing entries. Record the closing entries on Page 23 of the journal. Indicate closed accounts by inserting a line in both the Balance columns opposite the closing entry. Insert the new balance in the retained earnings account. 10. Prepare a post-closing trial balance.arrow_forwardRecording Sales Transactions Jeet Company and Reece Company use the perpetual inventory system. The following transactions occurred during the month of April: On April 1, Jeet purchased merchandise on account from Reece with credit terms of 2/10, n/30. The selling price of the merchandise was $3,100, and the cost of the merchandise sold was $2,225. On April 1, Jeet paid freight charges of $250 cash to have the goods delivered to its warehouse. On April 8, Jeet returned $800 of the merchandise. The cost of the merchandise returned was $500. On April 10, Jeet paid Reece the balance due. Required: Prepare the journal entries to record these transactions on the books of Reece Company. For a compound transaction, if those boxes in which no entry is required, leave the box blank.arrow_forward7. Salem Computers has the following transactions in September related to purchase of merchandise inventory. A (Click the icon to view the transactions.) Journalize the purchase transactions for Salem Computers assuming the company uses the perpetual inventory system. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Sept. 1: Purchase of $24,500 worth of computers on account, term of 2/ 10, n/30. - X More info Date Accounts and Explanation Debit Credit Sept. 1 September 1. Purchase of $24,500 worth of computers on account, term of 2/10, n/30. September 3 Return of $5,000 of the computers to the vendor. September 9 Payment made on account. Print Donearrow_forward
- Recording Sales Transactions Jeet Company and Reece Company use the perpetual inventory system. The following transactions occurred during the month of April: a. On April 1, Jeet purchased merchandise on account from Reece with credit terms of 2/10, n/30. The selling price of the merchandise was $3,100, and the cost of the merchandise sold was $2,225. b. On April 1, Jeet paid freight charges of $250 cash to have the goods delivered to its warehouse. c. On April 8, Jeet returned $800 of the merchandise. The cost of the merchandise returned was $500. d. On April 10, Jeet paid Reece the balance due. Required: Prepare the journal entries to record these transactions on the books of Reece Company. For a compound transaction, if those boxes in which no entry is required, leave the box blank. April 1 (Recorded sale on account) April 1 (Recorded cost of merchandise sold) April 8 (Record return of merchandise) April 8arrow_forwardRecording Sales Transactionsarrow_forwardPrepare the journal entry using perpetual inventory system and periodic inventory system.arrow_forward
- At the beginning of June, Circuit Country has a balance in inventory of $2,350. The following transactions occur during the month of June. June 2 Purchase radios on account from Radio World for $2,050, terms 2/15, n/45. June 4 Pay cash for freight charges related to the June 2 purchase from Radio World, $270. June 8 Return defective radios to Radio World and receive credit, $400. June 10 Pay Radio World in full. June 11 Sell radios to customers on account, $3,700, that had a cost of $2,550. June 18 Receive payment on account from customers, $2,700. June 20 Purchase radios on account from Sound Unlimited for $3,150, terms 2/10, n/30. June 23 Sell radios to customers for cash, $4,650, that had a cost of $2,950. June 26 Return damaged radios to Sound Unlimited and receive credit of $500. June 28 Pay Sound Unlimited in full. Required:1. Assuming that Circuit Country uses a periodic inventory system, record the…arrow_forwardAt the beginning of June, Circuit Country has a balance in inventory of $2,650. The following transactions occur during the month of June. June 2 Purchase radios on account from Radio World for $2,350, terms 2/15, n/45. June 4 Pay cash for freight charges related to the June 2 purchase from Radio World, $330. June 8 Return defective radios to Radio World and receive credit, $300. June 10 Pay Radio World in full. June 11 Sell radios to customers on account, $4,300, that had a cost of $2,850. June 18 Receive payment on account from customers, $3,300. June 20 Purchase radios on account from Sound Unlimited for $3,450, terms 2/10, n/30. June 23 Sell radios to customers for cash, $4,950, that had a cost of $3,250. June 26 Return damaged radios to Sound Unlimited and receive credit of $400. June 28 Pay Sound Unlimited in full.arrow_forwardUse the following transaction to answer the all of the questions. A company purchases inventory on credit for $80.000. Inventory costing $30,000 is sold on credit for $40,000. The applicable HST rate is 13% on sales and purchases. HST are remitted at the end of the month. What does the journal entry look like for the purchase of inventory using the periodic inventory system? Credit Purchases $30,000, Credit HST Payable $3,900, Credit, A/P the rest Debit Purchases $30,000, Debit HST Recoverable $3,900, Credit A/P the total of the 2 debits Credit Purchases $80,000, Credit HST Payable $10,400, Credit, A/P the rest Debit Purchases $80,000, Debit HST Recoverable $10,400, Credit, A/P the total of the 2 debitsarrow_forward
- Assume that on September 1, Office Depot had an inventory that included a variety of calculators. The company uses a perpetual inventory system. During September, these transactions occurred. Sept. 6 Purchased calculators from Cullumber Co. at a total cost of $1,750, on account, terms n/30. 9 Paid freight of $50 on calculators purchased from Cullumber Co. 10 Returned calculators to Cullumber Co. for $55 credit because they did not meet specifications. 12 Sold calculators costing $600 for $760 to Fryer Book Store, on account, terms n/30. 14 Granted credit of $45 to Fryer Book Store for the return of one calculator that was not ordered. The calculator cost $32. 20 Sold calculators costing $500 for $740 to Heasley Card Shop, on account, terms n/30. Journalize the September transactions. (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…arrow_forward8. Hampton Computers has the following transactions in August related to the sale of merchandise inventory. i (Click the icon to view the transactions.) Journalize the sales transactions for Hampton Computers assuming the company uses the perpetual inventory system. (Record debits first, then credits. Select the explanation on the last line of the journal entry table. Assume the company records sales at the net amount.) Aug. 12: Sold computers on account for $11,900 to a customer, terms 1/15, n/ 60. The cost of the computers is $7,140. Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step. Date Accounts and Explanation Debit Credit Aug. 12 More Info August 12 Sold computers on account for $11,900 to a customer, terms 1/15, n/60. The cost of the computers is $7,140. 26 Received payment from the customer on balance due. Choose from any list or enter any number in the input…arrow_forwardA company has the following transactions during March: March 3 Purchases inventory on account for $3,500, terms 2/10, n/30. March 5 Pays freight costs of $200 on inventory purchased on March 3. March 6 Returns inventory with a cost of $500. March 12 Pays the full amount due on March 3 purchase. March 29 Sells all inventory purchased on March 3 (less those returned on March 6) for $5,000 on account. Record all transactions, assuming the company uses a perpetual inventory system. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 3 View transaction list View journal entry worksheet Date March 03 No 1 2 3 4 5 6 March 05 March 06 March 12 March 29 March 29 Inventory Accounts Payable Inventory Cash Accounts Payable Inventory Accounts Payable Cash Accounts Receivable Sales Revenue Cost of Goods Sold Inventory General Journal Debit 3,500 200 500 3,000 5,000 3,140 Credit 3,500 200 500 2,940 5,000 3,140 ***arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
IAS 29 Financial Reporting in Hyperinflationary Economies: Summary 2021; Author: Silvia of CPDbox;https://www.youtube.com/watch?v=55luVuTYLY8;License: Standard Youtube License