journal entry

In response to requests from customers, S. Rey will begin selling computer software. The company will extend credit terms of 1/10, n/30, FOB shipping point, to all customers who purchase this merchan- dise. However, no cash discount is available on consulting fees. Additional accounts (Nos. 119, 413. 414, 415, and 502) are added to its general ledger to accommodate the company's new merchandising activities. Also, Business Solutions does not use reversing entries and, therefore, all revenue and ex- pense accounts have zero beginning balances as of January 1. 2018. Its transactions for January through March follow: Jan. 4 The company paid cash to Lyn Addie for five days' work at the rate of S125 per day. Four of the five days relate to wages payable that were accrued in the prior year. Wages Cxpena 5 Santana Rey invested an additional $25,000 cash in the company. 7 The company purchased $5,800 of merchandise from Kansas Corp. with terms of 1/10, n/30, FOB shipping point, invoice dated January 7. Chapter 5 Accounting for Merchandising Operations 244 The company received $2,668 cash from Gomez Co. as full payment on its account. The company completed a five-day project for Alex's Engineering Co. and billed it $5,500, which is the total price of $7,000 less the advance payment of $1,500. Check Jan. 1 1, D. Unenrned Computer Services Revonue. $1.500 The company sold merchandise with a retail value of $5,200 and a cost of $3,560 to Liu Corp. The company paid $600 cash for freight charges on the merchandise purchased on 13 invoice dated January 13. 15 January 7. The company received $4,000 cash from Delta Co. for computer services provided. 16 17 The company paid Kansas Corp. for the invoice dated January 7, net of the discount. Liu Corp. returned $500 of defective merchandise from its invoice dated January 13. The re 20 Jan. 20, No entry to turned merchandise, which had a $320 cost, is discarded. (The policy of Business Solutions is to leave the cost of defective products in Cost of Goods Sold.) 22 Cost of Goodis Soid The company received the balance due from Liu Corp., net of both the discount and the credit for the returned merchandise. 24 The company returned defective merchandise to Kansas Corp. and accepted a credit agains future purchases. The defective merchandise invoice cost, net of the discount, was $496. 26 The company purchased $9,000 of merchandise from Kansas Corp. with terms of 1/10. n/30 FOB destination, invoice dated January 26. 26 The company sold merchandise with a $4,640 cost for $5,800 on credit to KC, Inc. invoice dated January 26. The company paid cash to Lyn Addie for 10 days' work at $125 per day. The company paid $2,475 cash to Hillside Mall for another three months' rent in advance. The company paid Kansas Corp. for the balance due, net of the cash discount, less the $496 amount in the credit memorandum. The company paid $600 cash to the local newspaper for an advertising insert in today's paper. Feb. 1 The company received the balance due from Alex's Engineering Co. for fees billed on 11 January 11. Santana Rey withdrew $4,800 cash from the company for personal use. The company sold merchandise with a $2,660 cost for $3,220 on credit to Delta Co., invoice dated February 23. The company paid cash to Lyn Addie for eight days' work at $125 per day. 15 23 26 The company reimbursed Santana Rey for business automobile mileage (600 miles at $0.32 per 27 mile). The company purchased $2,730 of computer supplies from Harris Office Products on credi, invoice dated March 8. 9 The company received the balance due from Delta Co. for merchandise sold on February 23. The company paid S960 cash for minor repairs to the company's computer. 16 The company received $5,260 cash from Dream, Inc., for computing services provided. 19 The company paid the full amount due to Harris Office Products, consisting of amounts created on December 15 (of $1,100) and March 8. 24 The company billed Easy Leasing for $9,047 of computing services provided. The company sold merchandise with a $2,002 cost for $2,800 on credit to Wildcat Services, Mar. 8 11 25 invoice dated March 25. The company sold merchandise with a $1,048 cost for $2,220 on credit to IFM Company, in- voice dated March 30. 30 The company reimbursed Santana Rey for business automobile mileage (400 miles at $0.32 per 31 mile)