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Sales-Related Transactions The selected transactions below were completed by Affordable Supplies Co., which sells supplies primarily to wholesalers and occasionally to retail customers. Instructions: Illustrate the effects on the accounts and nancial statements of recording the following transactions of Affordable Supplies Co. If no account or activity is affected, select "No effect" from the dropdown list and leave the corresponding number entry box blank. Enter account decreases, cash outflows, and the income statement effects that reduce net income as negative amounts. Jan. 6. Sold merchandise on account, $14,000, terms FOB shipping point, n/eom. The cost of merchandise sold was $8,400. ---_IIII Jan. 8. Sold merchandise on account, $20,000, terms FOB destination, 1/10, n/30. The cost of merchandise sold was $14,000. Balance Sheet Statement of = + Cash Flows Assets Liabilities Stockholders' Equity Income Statement Accounts Receivable + Inventory = No Effect + Retained Earnings Jan. 8. -14,000 0 Jan. 8. Statement of Cash Flows Income Statement No effect 0 Sales Cost of goods sold Net incomeJan. 16. Sold merchandise on account, $19,500, terms FOB shipping point, n/30. The cost of merchandise sold was $11,700. Balance Sheet Statement of Income Assets Liabilities + Stockholders' Equity Cash Flows Statement Accounts Receivable + Inventory = No effect Retained Earnings Jan. 16. -11,700 0 Jan. 16. Statement of Cash Flows Income Statement No effect Sales Cost of goods sold Net incomeJan. 18. Received check for amount due for sale on January 8. Balance Sheet Statement of Stockholders' Income Assets Liabilities + Cash Flows Equity Statement Cash + Accounts Receivable = No Effect + No Effect Jan. 18. 0 0 Jan. 18. Statement of Cash Flows Income Statement Operating No effect 0Jan. 19. Issued credit memorandum for $4,500 for merchandise returned from sale on January 16. The cost of the merchandise returned was $2,700. Balance Sheet Statement of Income Liabilities Stockholders' Assets + Cash Flows Equity Statement Accounts Receivable + Inventory + Est. Returns Inventory Cust. Refunds Payable + No Effect Jan. 19. Jan. 19. Statement of Cash Flows Income Statement No effect No effectJan. 26. Received check for amount due for sale on January 16 less credit memorandum of January 19. Balance Sheet Statement of Stockholders' Income Assets = Liabilities + Cash Flows Equity Statement Cash + Accounts Receivable No Effect No Effect Jan. 26. 0 0 Jan. 26. Statement of Cash Flows Income Statement Operating No effect 0Jan. 31. Paid Cashell Delivery Service $3,000 for merchandise delivered during January to customers under shipping terms of FOB destin Balance Sheet Statement of Income Assets = Liabilities + Stockholders' Equity Cash Flows Statement Cash + No Effect = No Effect + Retained Earnings Jan. 31. 0 0 Jan. 31. Statement of Cash Flows Income Statement Operating Delivery expense Jan. 31. Received check for amount due for sale of January 6. Balance Sheet Statement of Stockholders' Income Assets = Liabilities + Cash Flows Equity Statement Cash + Accounts Receivable = No Effect No Effect Jan. 31. 0 0 Statement of Cash Flows Income Statement Operatina No effect
