JUL SHOW ME ON BE 5-6 Adjusting entries Hahn Flooring Company uses a perpetual inventory system. Journalize the December 31 ing entries based upon the following: A Sales returns of $125,000 and merchandise returns of $80,000 are estimated for the current year's sales. B. The inventory account has a balance of $1,333,150, while physical inventory indicates that $1,309,900 of merchandise is on hand. Assume any shrinkage is a normal amount. xercises W MEW EX 5-1 Determining gross profit Obj. 1 During the current year, merchandise is sold for $11.750,000. The cost of the goods sold is $7,050,000. A. What is the amount of the gross profit? B. Compute the gross profit percentage (gross profit divided by sales). Will the income statement always report a net income? Explain. EX 5-2 Determining cost of goods sold Obj. 1 For a recent year, Best Buy reported sales of $42.410 million. Its gross profit was $9,690 mil lion. What was the amount of Best Buy's cost of goods sold? REAL WORLD SHOW ME HOW EX 5-3 Purchase-related transactions Obj. The Stationery Company purchased merchandise on account from a supplier for $28.900, term 1/10, n/30. The Stationery Company returned $6,100 of the merchandise and received full credit A. What is the amount of cash required for the payment? B. Under a perpetual inventory system, what account is credited by The Stationer Company to record the return? EX 5-4 Purchase-related transactions Obj. A retailer is considering the purchase of 250 units of a specific item from either of two supplier Their offers are as follows: Supplier One: $400 a unit, total of $100,000, 1/10,n/30, no charge for freight. Supplier Two: $399 a unit, total of $99,750,2/10,n/30, plus freight of $975. Which of the two offers, Supplier One or Supplier Two, yields the lower price? EX 5-5 Purchase-related transactions Obj. The debits and credits from four related transactions, A through D, are presented the following T accounts. Describe each transaction Cash 300 C 6 Accounts Payable 3,920 A 16,660 3920 20,580 20,580 16,660 Inventory 20,580 C 300 3.920 JUL SHOW ME ON BE 5-6 Adjusting entries Hahn Flooring Company uses a perpetual inventory system. Journalize the December 31 ing entries based upon the following: A Sales returns of $125,000 and merchandise returns of $80,000 are estimated for the current year's sales. B. The inventory account has a balance of $1,333,150, while physical inventory indicates that $1,309,900 of merchandise is on hand. Assume any shrinkage is a normal amount. xercises W MEW EX 5-1 Determining gross profit Obj. 1 During the current year, merchandise is sold for $11.750,000. The cost of the goods sold is $7,050,000. A. What is the amount of the gross profit? B. Compute the gross profit percentage (gross profit divided by sales). Will the income statement always report a net income? Explain. EX 5-2 Determining cost of goods sold Obj. 1 For a recent year, Best Buy reported sales of $42.410 million. Its gross profit was $9,690 mil lion. What was the amount of Best Buy's cost of goods sold? REAL WORLD SHOW ME HOW EX 5-3 Purchase-related transactions Obj. The Stationery Company purchased merchandise on account from a supplier for $28.900, term 1/10, n/30. The Stationery Company returned $6,100 of the merchandise and received full credit A. What is the amount of cash required for the payment? B. Under a perpetual inventory system, what account is credited by The Stationer Company to record the return? EX 5-4 Purchase-related transactions Obj. A retailer is considering the purchase of 250 units of a specific item from either of two supplier Their offers are as follows: Supplier One: $400 a unit, total of $100,000, 1/10,n/30, no charge for freight. Supplier Two: $399 a unit, total of $99,750,2/10,n/30, plus freight of $975. Which of the two offers, Supplier One or Supplier Two, yields the lower price? EX 5-5 Purchase-related transactions Obj. The debits and credits from four related transactions, A through D, are presented the following T accounts. Describe each transaction Cash 300 C 6 Accounts Payable 3,920 A 16,660 3920 20,580 20,580 16,660 Inventory 20,580 C 300 3.920
