Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problem 3-26 Comprehensive cycle problem: Perpetual system LO 3-2, 3-3, 3-4, 3-5 At the beginning of 2013, the Bradley Company had the following balances in

Problem 3-26 Comprehensive cycle problem: Perpetual system LO 3-2, 3-3, 3-4, 3-5 At the beginning of 2013, the Bradley Company had the following balances in its accounts: Cash $ 8,200 Inventory 2,200 Common stock 7,700 Retained earnings 2,700 During 2014, the company experienced the following events: 1. Purchased inventory that cost $5,700 on account from Bivins Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of $520 were paid in cash. 2. Returned $350 of the inventory that it had purchased because the inventory was damaged in transit. The seller agreed to pay the return freight cost. 3. Paid the amount due on its account payable to Bivins Company within the cash discount period. 4. Sold inventory that had cost $6,200 for $9,200 on account, under terms 2/10, n/45. 5. Received merchandise returned from a customer. The merchandise originally cost $520 and was sold to the customer for $820 cash. The customer was paid $820 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $620 were paid in cash. 7. Collected the amount due on the account receivable within the discount period. 8. Took a physical count indicating that $1,900 of inventory was on hand at the end of the accounting period. References Section BreakProblem 3-26 Comprehensive cycle problem: Perpetual system LO 3-2, 3-3, 3-4, 3-5 Problem 3-26 Part b Required b. Record each event in a statements model like the following one. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, NC for net change in cash and NA to indicate the element is not affected by the event. The first event is recorded as an example. (Enter any decreases to account balances and cash outflows with a minus sign.) Problem 3-26 Part c Required c-1. Prepare a multistep income statement. c-2. Prepare a statement of changes in stockholders equity. c-3. Prepare a balance sheet. c-4. Prepare a statement of cash flows. (Enter cash outflows as negative amounts.) ReferenceseBook & Resources WorksheetLearning Objective: 03-02 Show how

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Mantras Forensic Accounting Important Standards On Auditing

Authors: Buffy Mielcarek

1st Edition

B09PP4SKL1, 979-8796281437

More Books

Students also viewed these Accounting questions

Question

4. Describe cultural differences that influence perception

Answered: 1 week ago