Halifax Manufacturing allows its customers to return merchandise for any reason and receive a credit to...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Halifax Manufacturing allows its customers to return merchandise for any reason and receive a credit to their accounts. All of Halifax's sales are for credit (no cash is collected at the time of sale). The company began 2024 with a refund liability of $300,000. During 2024, Halifax sold merchandise on account for $11,500,000. Halifax's merchandise costs it 65% of merchandise selling price. Also during the year, customers returned $450,000 in sales for credit, with $250,000 of those being returns of merchandise sold prior to 2024, and the rest being merchandise sold during 2024. Sales returns, estimated to be 4% of sales, are recorded as an adjusting entry at the end of the year. Required: 1. Prepare entries to (a) record actual returns in 2024 of merchandise that was sold prior to 2024; (b) record actual returns in 2024 of merchandise that was sold during 2024; and (c) adjust the refund liability to its appropriate balance at year end. 2. What is the amount of the year-end refund liability after the adjusting entry is recorded? Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare entries to (a) record actual returns in 2024 of merchandise that was sold prior to 2024; (b) record actual returns in 2024 of merchandise that was sold during 2024; and (c) adjust the refund liability to its appropriate balance at year end. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Year 1 2024 Refund liability Accounts receivable 24 2024 Inventory 3 2024 General Journal Inventory-estimated returns Sales returns Accounts receivable 4 2024 Inventory Cost of goods sold 5 2024 Sales returns Refund liability 6 2024 Inventory-estimated returns Cost of goods sold Required 1 Required 2 Debit 250,000 Credit 250,000 >> 00 162.500 162.500 200,000 200,000 130,000 130,000 What is the amount of the year-end refund liability after the adjusting entry is recorded? Ending balance in refund liability Show less Halifax Manufacturing allows its customers to return merchandise for any reason and receive a credit to their accounts. All of Halifax's sales are for credit (no cash is collected at the time of sale). The company began 2024 with a refund liability of $300,000. During 2024, Halifax sold merchandise on account for $11,500,000. Halifax's merchandise costs it 65% of merchandise selling price. Also during the year, customers returned $450,000 in sales for credit, with $250,000 of those being returns of merchandise sold prior to 2024, and the rest being merchandise sold during 2024. Sales returns, estimated to be 4% of sales, are recorded as an adjusting entry at the end of the year. Required: 1. Prepare entries to (a) record actual returns in 2024 of merchandise that was sold prior to 2024; (b) record actual returns in 2024 of merchandise that was sold during 2024; and (c) adjust the refund liability to its appropriate balance at year end. 2. What is the amount of the year-end refund liability after the adjusting entry is recorded? Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare entries to (a) record actual returns in 2024 of merchandise that was sold prior to 2024; (b) record actual returns in 2024 of merchandise that was sold during 2024; and (c) adjust the refund liability to its appropriate balance at year end. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No Year 1 2024 Refund liability Accounts receivable 24 2024 Inventory 3 2024 General Journal Inventory-estimated returns Sales returns Accounts receivable 4 2024 Inventory Cost of goods sold 5 2024 Sales returns Refund liability 6 2024 Inventory-estimated returns Cost of goods sold Required 1 Required 2 Debit 250,000 Credit 250,000 >> 00 162.500 162.500 200,000 200,000 130,000 130,000 What is the amount of the year-end refund liability after the adjusting entry is recorded? Ending balance in refund liability Show less
Expert Answer:
Answer rating: 100% (QA)
The image shows an accounting problem that involves recording actual returns and adjusting the refund liability It mentions that Halifax Manufacturing ... View the full answer
Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
Posted Date:
Students also viewed these accounting questions
-
Halifax Manufacturing allows its customers to return merchandise for any reason and receive a credit to their accounts. All of Halifaxs sales are for credit (no cash is collected at the time of...
-
Develop a simple chat application for message exchange among remote peers with 8 functions. 2. Implement write C++ or Java code that compiles in Linux (e.g., Ubuntu) or Windows system NOTE: You...
-
Compensation System Change Introduction As Melanie Griffith gazed through the window of her office, she could see some employees walking to the parking lot to get to their cars; others were on their...
-
Prove: If A is invertible, then adj(A) is invertible and [adj(A) det( A)
-
You bought two items for a total of $78.92. The first item is GST exempt and it represents 25% of the total purchase price. Assuming that you live in the Northwest Territories, what is the total...
-
Find the area to the right of 46.979 under the chi-square distribution with 30 degrees of freedom.
-
Calculate financial leverage measures. The following information was available for the year ended December 31, 2013: Earnings before interest and taxes (operating income) ....... $60,000 Interest...
-
Describe at least four forces for change and four for the status quo. Then, outline the change(s) you want to see. Describe the end goal and the consequence of the change with one to two sentences....
-
You are a stock analyst in charge of valuing high-technology firms, and you are expected to come out with buy-sell recommendations for your clients. You are currently analyzing a firm called e...
-
What might be challenges for public administrators in orchestrating ethical performances when working with individual ethics inside and outside the organization?
-
On January 1, 2023, Bertrand, Incorporated, paid $70,800 for a 40 percent interest in Chestnut Corporation's common stock. This Investee had assets with a book value of $235,000 and liabilities of...
-
Please review this website. ( https://www.kpmg.us/content/dam/global/pdfs/2021/kpmg-us-2021-dei-report.pdf ) Answer the following question Part I What is the business case for diversity? Why are...
-
If individual values that underline ethics are developed at a young age, what might this suggest about the potential for ethical conflicts to arise within an organization?
-
Question 1. From the research for this terms Crisis Management Team Assignment - Taylor swift and Ticket Master Crisis a. Explaining, with some detail, three (3) specific things that the leader(s) in...
-
Find: (a) open-loop stability (b) stability for G(s) = K (c) stability for PD and PI (d) appropriate controller to meet specs. (e) simulate step response; 2nd order dominant? S+1 Given: G,(s) =...
-
Find the reduced echelon form of each of the matrices given in Problems 120. c 1 26 + 4
-
Stewart Enterprises has the following investments, all purchased prior to 2018: 1. Bee Company 5% bonds, purchased at face value, with an amortized cost of $4,000,000, and classified as held to...
-
Chadwick Enterprises, Inc., operates several restaurants throughout the Midwest. Three of its restaurants located in the center of a large urban area have experienced declining profits due to...
-
Kaman Corporation, headquartered in Bloomfield, Connecticut, was incorporated in 1945. It is a diversified company that conducts business in the aerospace and distribution markets. The following is...
-
8P1 In Exercises 1722, evaluate the permutation.
-
45P5 In Exercises 1722, evaluate the permutation.
-
Let A and B be events with P (A) = 0.2 and P (B) = 0.9. Assume that A and B are independent. Find P (A and B).
Study smarter with the SolutionInn App