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Question The following trial balance pertains to Feazell Hardware as of January 1, 2013. Account Title Debit Credit Cash $ 28,000 Account Receivable 18,000 Merchandise
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The following trial balance pertains to Feazell Hardware as of January 1, 2013.
Account Title | Debit | Credit |
Cash | $ 28,000 |
|
Account Receivable | 18,000 |
|
Merchandise Inventory | 120,000 |
|
Accounts Payable |
| $ 10,000 |
Common Stock |
| 140,000 |
Retained Earnings |
| 16,000 |
The following events occurred in 2013. Assume that Feazell Hardware uses the periodic inventory system.
- Purchased land for $16,000 cash
- Purchased merchandise on account for $46,000, terms 2/10 n/30.
- The merchandise purchased by Feazell was shipped FOB shipping point for $460 cash.
- Returned $4,000 of defective merchandise purchased in Event 2
- Sold merchandise for $4,000 cash
- Sold merchandise on account for $100,000, terms 1/20 n/30.
- Paid cash within the discount period on accounts payable due on merchandise purchased in Event 2.
- Paid $2,400 cash for selling expenses.
- Collected $70,000 of accounts receivable within the discount period.
- Collected $24,000 of accounts receivable but not within the discount period.
- Paid $6,400 of other operating expenses.
- Performed a physical count indicating that $60,000 of inventory was on hand at the end of the accounting period.
Requirements
- Record these transactions in a general journal.
- Post the transactions to ledger T-accounts.
- Prepare a schedule of cost of goods sold, an income statement, a statement of changes in stockholders equity, a balance sheet and a statement of cash flows for 2013.
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