Activity 5

Recording Merchandise Transaction Using Periodic Inventory System (9 items x 3 points per correct debit and credit amount and explanation)

Assuming that Mac Company uses the Periodic Inventory System, Make a journal entry to the following transactions:

July 1 Sold the Merchandise to A company on credit, terms n/30, FOB shipping point, P105,000 (cost, P63,000)

July 2 Purchased merchandise on credit from B company, terms n/30, FOB shipping point, P190,000.

July 2 Paid Custom Freight P14,500 for freight charges on merchandise received.

July 9 Purchased merchandise on credit from C company, terms n/30, FOB shipping point, P180,000 including P10,000 freight cost by C company.

July 11 Accepted from A company a return of merchandise, which was returned to inventory, P15,000 (cost, P9,000)

July 14 Returned for credit P30,000 of merchandise purchased on July 2

July 16 Sold Merchandise for cash, P50,000 (cost, P30,000)

July 22 Paid B company for purchase of July 2 less return on July 14

July 23 Received full payment from A company for this July 1 purchase, less return on July 11.

Activity 6

Financial Statement Classifications (25 items x 2 points)

You are presented with the following list of accounts from the adjusted trial balance for merchandiser Gorman Company. Indicate which financial statement and under what classification each of the following accounts would be reported.

Choices:

Financial Statements: Balance Sheet, Income Statement, Owner's Equity

Classification: Current Assets, Current Liabilities, PPE, Noncurrent Liabilities, Sales , Other Revenues and Gains, Operating Expense, Deduction Section (Equity), Beginning Balance (Equity) Other expenses and loses

AccountFinancial StatementClassification

1. Accounts Payable

2. Interest Payable

3. Accounts Receivable

4. Inventory

5.Accumulated Depreciation- Buildings

6. Land

7. Accumulated Depreciation- Equipment

8. Notes Payable

9. Advertising expense

10. Owner's Capital (Beginning Balance)

11. Building

12. Owner's Drawings

13. Cash

14.Property Taxes Payable

15. Depreciation Expense

16. Salaries and wages expense

17. Equipment

18. Salaries and wages payable

19. Freight-out

20. Sales Return and Allowances

21. Gain on Disposal of Plant Assets

22. Sales Revenue

23. Insurance Expense

24. Utilities Expense

25. Interest Expense