Question 1

Ma Hardware is the only hardware store in a remote area of Hong Kong Some of Ma's transactions during the current year are as follows Nov. 5 Sold lumber on account to Bemidji Construction, $13,390. The inventory subsidiary ledger shows the cost of this goods was $9,105 Nov. 9 Purchased tools on account from Owatonna Tool Company, $3,800 Dec. 5 Collected in cash the $13,390 account receivable from Bemidji Construction Dec. 9 Paid the $3,800 owed to Owatonna Tool Company Dec. 31 Ma's personnel counted the inventory on hand and determined its cost to be $182,080. The accounting records, however, indicate inventory of $183,790 and a cost of goods sold of $695,222. The physical count of the inventory was observed by the company's auditors and is considered correct Instructions a. Prepare journal entries to record these transactions and events in the accounting records of Ma Hardware. (The company uses a perpetual inventory system) (Omit the "$" sign in your response.) Date General Journal Debit Credit Sold goods on account Nov. 5 (Click to select) (Click to select) To record the cost of goods sold relating to the sales of inventory to Bemidi Construction 5 (Click to select) (Click to select) Purchased inventory on credit (Click to select) 9 (Click to select) Colected accounts receivable Dec. (Click to select) 5 (Click to select) 9 Paid account payable to supplier (Click to select) (Click to select) To adjust inventory records to reflect the results of the year-end physical count 31 (Click to select) (Click to select) b. Prepare a partial income statement showing the company's gross profit for the year (Net sales for the year amount to $1,024,900) (Amounts to be deducted should be indicated with a minus sign Omit the "$" sign in your response.) Ma HARDWARE Partial Income Statement For the Year Ended December 31,20 (Clck to select) Click to select (Click to select) (Click to select (Click to select) Click to select) Ma purchases inventory at the same wholesale prices as other hardware stores. Due to its remote