Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

At the beginning of Year 2, the Redd Company had the following balances in its accounts: During Year 2, the company expetienced the following events

image text in transcribed
image text in transcribed
At the beginning of Year 2, the Redd Company had the following balances in its accounts: During Year 2, the company expetienced the following events 1. Purchased inventory that cost $5,200 on account from Ross Company under terms 2/10,n/30. The merchandise was delivered FOB shipping point. Freight costs of $470 were paid in cash 2. Returned $400 of the inventory that it had purchased because the inventory was damaged in transit The seller agreed to pay the return freight cost 3. Paid the amount due on its account poyable to Ross Company within the cash discount period 4. Sold inventory that had cost $5,700 for $8,700 on account, under terms 2/10,n/45 5. Recelved merchandise returned from a customer. The merchandise originally cost $470 and was sold to the customet for $770 cash. The customer was paid $770 cash for the retumed merchandise 6. Delivered goods FOB destination in Event 4. Freight costs of $570 were paid in cashle 7. Collected the amount due on the account receivable within the discount period 8. Took a physical count indicating that 51,400 of imventory was on hand at the end of the accounting period 2 0Requiredinformation \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \multirow{3}{*}{ Evert } & \multicolumn{6}{|c|}{ Balance Sheer } & \multicolumn{3}{|c|}{ Inconice Statement } & \multirow{3}{*}{\multicolumn{2}{|c|}{\begin{tabular}{l} Statoment of Cash \\ Flows \end{tabular}}} \\ \hline & \multicolumn{3}{|c|}{ Assets } & & \multirow{2}{*}{\multicolumn{2}{|c|}{\begin{tabular}{l} Slockholdoro' Equily \\ Common + Rothilied \end{tabular}}} & \multirow{2}{*}{ Rovenue } & \multirow{2}{*}{ Expenases } & \multirow{2}{*}{\begin{tabular}{l} Not \\ Incorme \end{tabular}} & & \\ \hline & cash & \begin{tabular}{l} - Accounts \\ Recilinati \end{tabular} & \begin{tabular}{l} Morchandisise \\ tiventiony \end{tabular} & & & & & & & & \\ \hline Bal & 7,70 & & 1700 & & 7.200 & 2200 & & & & & \\ \hline 1a & & & & & & = & & & & & \\ \hline ib & & & & & & & & & + & & \\ \hline 2 & & & & & & A & = & & & 0 & \\ \hline 3 & & & & & & & & & & & \\ \hline 4a & & & & & & & & & & & \\ \hline 4b & & & & & & & & + & & & \\ \hline 50 & & & & & & & -1 & & & & \\ \hline 5b & & & & & = & & 5 & & & & \\ \hline75 & & - & f. & & - & & & & - & & \\ \hline 8 & & - & & - & & 8 & & & =1 & & \\ \hline BAI & & & & & & & & & w & & 27 \\ \hline \end{tabular} At the beginning of Year 2, the Redd Company had the following balances in its accounts: During Year 2, the company expetienced the following events 1. Purchased inventory that cost $5,200 on account from Ross Company under terms 2/10,n/30. The merchandise was delivered FOB shipping point. Freight costs of $470 were paid in cash 2. Returned $400 of the inventory that it had purchased because the inventory was damaged in transit The seller agreed to pay the return freight cost 3. Paid the amount due on its account poyable to Ross Company within the cash discount period 4. Sold inventory that had cost $5,700 for $8,700 on account, under terms 2/10,n/45 5. Recelved merchandise returned from a customer. The merchandise originally cost $470 and was sold to the customet for $770 cash. The customer was paid $770 cash for the retumed merchandise 6. Delivered goods FOB destination in Event 4. Freight costs of $570 were paid in cashle 7. Collected the amount due on the account receivable within the discount period 8. Took a physical count indicating that 51,400 of imventory was on hand at the end of the accounting period 2 0Requiredinformation \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \multirow{3}{*}{ Evert } & \multicolumn{6}{|c|}{ Balance Sheer } & \multicolumn{3}{|c|}{ Inconice Statement } & \multirow{3}{*}{\multicolumn{2}{|c|}{\begin{tabular}{l} Statoment of Cash \\ Flows \end{tabular}}} \\ \hline & \multicolumn{3}{|c|}{ Assets } & & \multirow{2}{*}{\multicolumn{2}{|c|}{\begin{tabular}{l} Slockholdoro' Equily \\ Common + Rothilied \end{tabular}}} & \multirow{2}{*}{ Rovenue } & \multirow{2}{*}{ Expenases } & \multirow{2}{*}{\begin{tabular}{l} Not \\ Incorme \end{tabular}} & & \\ \hline & cash & \begin{tabular}{l} - Accounts \\ Recilinati \end{tabular} & \begin{tabular}{l} Morchandisise \\ tiventiony \end{tabular} & & & & & & & & \\ \hline Bal & 7,70 & & 1700 & & 7.200 & 2200 & & & & & \\ \hline 1a & & & & & & = & & & & & \\ \hline ib & & & & & & & & & + & & \\ \hline 2 & & & & & & A & = & & & 0 & \\ \hline 3 & & & & & & & & & & & \\ \hline 4a & & & & & & & & & & & \\ \hline 4b & & & & & & & & + & & & \\ \hline 50 & & & & & & & -1 & & & & \\ \hline 5b & & & & & = & & 5 & & & & \\ \hline75 & & - & f. & & - & & & & - & & \\ \hline 8 & & - & & - & & 8 & & & =1 & & \\ \hline BAI & & & & & & & & & w & & 27 \\ \hline \end{tabular}

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Essential Handbook Of Internal Auditing

Authors: K. H. Spencer Pickett

1st Edition

0470013168, 978-0470013168

More Books

Students also viewed these Accounting questions