must be done in 30 minutes

1.Insert the letter for each term in the blank space beside the definition that it most closely matches:

A. Cash discount E. FOB shipping point H. Purchases discount

B. Credit period F. Gross profit I. Sales discount

C. Discount period G. Inventory J. Trade discount

D. FOB destination

___ 1. An agreement that ownership of goods is transferred at the buyer's place of business.

___ 2. The time period in which a cash discount is available.

___ 3. The difference between net sales and the cost of goods sold.

___ 4. A reduction in a receivable or payable that is granted if it is paid within the discount period.

___ 5. A cash discount taken against an amount owed to a supplier of goods.

___ 6. An agreement that ownership of goods is transferred at the seller's place of business.

___ 7. A reduction below a list or catalogue price that is negotiated in setting the selling price of goods.

___ 8. A cash discount taken by customers against an amount owed to the seller.

___ 9. The time period that can pass before a customer's payment is due.

___ 10. The goods that a company owns and expects to sell to its customers.

2.Determine each of the missing numbers in the following situations

X Y Z

Purchases . . . . . . . . . . . . . . . . . . . . . $45,000 $80,000 $61,000

Purchases discounts . . . . . . . . . . . . . 2,000 a 1,300

Purchases returns and allowances . . . . 1,500 3,000 2,200

Transportation-in . . . . . . . . . . . . . . . b 7,000 8,000

Beginning inventory . . . . . . . . . . . . . 3,500 c 18,000

Cost of goods purchased . . . . . . . . . . 44,700 79,000 d

Ending inventory . . . . . . . . . . . . . . . 2,200 15,000 e

Cost of goods sold . . . . . . . . . . . . . . f 83,200 68,260

3.Prepare journal entries to record the following transactions for a retail store:

March 2 Purchased merchandise from Alfa Company under the following terms: $1,800 invoice price, 2/15, n/60, FOB shipping point.

3 Paid $125 for shipping charges on the purchase of March 2.

4 Returned to Alfa Company unacceptable merchandise that had an invoice price of $300.

17 Sent a cheque to Alfa Company for the March 2 purchase, net of the discount and the returned merchandise.

18 Purchased merchandise from Bravo Company under the following terms: $2,500 invoice price, 2/10, n/30, FOB destination.

21 After brief negotiations, received a credit memorandum from Bravo Company granting a $700 allowance on the purchase of March 18.

28 Sent a cheque to Bravo Company paying for the March 18 purchase, net of

the discount and the allowance.

4. On May 12, William Company accepted delivery of $20,000 of merchandise and received an invoice dated May 11, with terms of 3/10, n/30, FOB shipping point. When the goods were delivered, William Company paid $185 to Express Shipping Service for the delivery charges on the merchandise. The next day, William Company returned $800 of defective goods to the seller, which received them one day later. On May 21, William Company mailed a cheque to Gabriel Company for the amount owed on that date. It was received the following day.

Required

a. Present the journal entries that William Company should record for these transactions.

b. Present the journal entries that Gabriel Company should record for these transactions