Financial accounting
3rd Edition
ISBN: 9780077506902
Author: David J Spieceland Wayne Thomas Don Herrmann
Publisher: Mcgraw-Hill
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 6, Problem 6.7E
Record inventory purchase and purchase return using a perpetual system (LO6–5)
On June 5, Staley Electronics purchases 200 units of inventory on account for $20 each. After closer examination, Staley determines 40 units are defective and returns them to its supplier for full credit on June 9. All remaining inventory is sold on account on June 16 for $35 each.
Required:
Record transactions for the purchase, return, and sale of inventory using a perpetual system.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Record journal entries for the following purchase transactions of Apex Industries.
Nov. 6
Purchased 21 computers on credit for $560 per computer. Terms of the purchase are 4/10,
n/60, invoice dated November 6.
Nov. 10 Returned 6 defective computers for a full refund from the manufacturer.
Nov. 22 Paid account in full from the November 6 purchase.
If an amount box does not require an entry, leave it blank. Assume the perpetual inventory system is used.
Nov. 6
Nov. 10
Nov. 22
Prepare the journal entries to record the following transactions on Skysong, Inc.'s books using a perpetual inventory system.
On March 2, Riverbed Company sold $932,000 of merchandise on account to Skysong, Inc., terms 3/10, n/30. The cost of the
merchandise sold was $592,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If
entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Account Titles and Explanation
I
eTextbook and Media
List of Accounts
norcal_archives_20....zip
On March 6, Skysong, Inc. returned $93,200 of the merchandise purchased on March 2. The cost of the returned merchandise
was $59,200. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter O for the amounts.)
A
Debit
QCA 5.docx
Credit
response essay.docx
N
Record the following transactions in the general journal. The company uses perpetual inventory. Eliminate explanations. When completed, upload your file using pdf or doc only to this problem.
Nov
1
Purchased merchandise for $1,500 on credit with terms of 2/5, n/30, FOB shipping point; invoice dated November 1.
5
Returned $200 of defective merchandise purchased on November 1.
7
Paid cash for the November 1 purchase.
10
Paid $90 cash for transportation cost from the November 1 purchase.
13
Sold merchandise for $1,600 on credit. The cost of the merchandise is $800
16
Granted credit to customer from November 13 transaction. The returned items are priced at $300 and the cost is $130; the items were not damaged and were returned to inventory.
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
- Sunrise Flowers sells flowers to a customer on credit for $130 on October 18, with a cost of sale to Sunrise of $50. What entry to recognize this sale is required if Sunrise Flowers uses a perpetual inventory system?arrow_forwardRescue Sequences LLC purchased inventory by issuing a 30,000, 10%, 60-day note on October 1. Prepare the journal entries for Rescue Sequences to record the purchase and payment assuming it uses a perpetual inventory system and a 360-day calendar fiscal year. Rescue Sequences LLC uses a perpetual inventory system.arrow_forwardReview the following transactions, and prepare any necessary journal entries for Sewing Masters Inc. A. On October 3, Sewing Masters Inc. purchases 800 yards of fabric (Fabric Inventory) at $9.00 per yard from a supplier, on credit. Terms of the purchase are 1/5, n/40 from the invoice date of October 3. B. On October 8, Sewing Masters Inc. purchases 300 more yards of fabric from the same supplier at an increased price of $9.25 per yard, on credit. Terms of the purchase are 5/10, n/20 from the invoice date of October 8. C. On October 18, Sewing Masters pays cash for the amount due to the fabric supplier from the October 8 transaction. D. On October 23, Sewing Masters pays cash for the amount due to the fabric supplier from the October 3 transaction.arrow_forward
- RE7-8 Johnson Company uses a perpetual inventory system. On October 23, Johnson purchased 100,000 of inventory on credit with payment terms of 1/15, net 45. Using the net price method, prepare journal entries to record Johnsons purchases on October 23 and the subsequent payment on October 31. Using the information from RE7-8, prepare journal entries to record Johnsons purchase on October 23 and the subsequent payment on November 30.arrow_forwardPalisade 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_forwardPalisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2016 (unless otherwise indicated), are as follows: During May, the last month of the fiscal year, the following transactions were completed: 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 July, 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 owners equity, and a balance sheet. 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 owners capital account. 10. Prepare a post-closing trial balance.arrow_forward
- Prepare the journal entries to record the following transactions on Blossom Company's books using a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) On March 2, Kingbird Company sold $889,200 of merchandise to Blossom Company on account, terms 2/10, n/30. The cost of the merchandise sold was $573,500. On March 6, Blossom Company returned $111,100 of the merchandise purchased on March 2. The cost of the merchandise returned was $67,400. (a) (b) (c) On March 12, Kingbird Company received the balance due from Blossom Company. Date Account Titles and Explanation Debit Credit March 2 Inventory 889,200 Accounts Payable 889,200 March 6 Accounts Payable 111,100 Inventory 111,100 March 12 Accounts Payable 754,757 Cash 23,343 inventory 778,100arrow_forwardPrepare the journal entries to record the following transactions on Blossom Company’s books using a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (a) On March 2, Kingbird Company sold $850,000 of merchandise to Blossom Company on account, terms 2/10, n/30. The cost of the merchandise sold was $500,000. (b) On March 6, Blossom Company returned $100,000 of the merchandise purchased on March 2. The cost of the merchandise returned was $60,000. (c) On March 12, Kingbird Company received the balance due from Blossom Company. No. Date Account Titles and Explanation Debit Credit (a) choose a transaction date March 2March 6March 12 enter an account title enter a…arrow_forwardPrepare the journal entries to record the following transactions on Blossom Company’s books using a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) (a) On March 2, Kingbird Company sold $850,000 of merchandise to Blossom Company on account, terms 2/10, n/30. The cost of the merchandise sold was $500,000. (b) On March 6, Blossom Company returned $100,000 of the merchandise purchased on March 2. The cost of the merchandise returned was $60,000. (c) On March 12, Kingbird Company received the balance due from Blossom Company.arrow_forward
- Teal Mountain, Inc. uses a perpetual inventory system. Its beginning inventory consists of 200 units that cost $ 220 each. During August, the company purchased 255 units at $ 220 each, returned 4 units for credit, and sold 375 units at $ 340 each. Journalize the August transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)arrow_forwardPrepare the journal entries to record the following transactions on Ivanhoe Company's books using a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) On March 2, Metlock Company sold $882,900 of merchandise to Ivanhoe Company on account, terms 3/10, n/30. The cost of the merchandise sold was $527,900. (a) On March 6, Ivanhoe Company returned $107,600 of the merchandise purchased on March 2. The cost of the merchandise returned was $66,800. (b) (c) On March 12, Metlock Company received the balance due from Ivanhoe Company. Date Account Titles and Explanation Debit Credit March 2arrow_forwardAssume the perpetual inventory system is used unless stated otherwise. Round all numbers to the nearest whole dollar unless stated otherwise. Journalizing sales transactions—periodic inventory system Journalize the following sales transactions for Sanborn Camera Store using the periodic inventory system. Explanations are not required.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage Learning
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Chapter 6 Merchandise Inventory; Author: Vicki Stewart;https://www.youtube.com/watch?v=DnrcQLD2yKU;License: Standard YouTube License, CC-BY
Accounting for Merchandising Operations Recording Purchases of Merchandise; Author: Socrat Ghadban;https://www.youtube.com/watch?v=iQp5UoYpG20;License: Standard Youtube License