Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The company uses uses all typical accounts used by a merchandising business. Listed below are accounts with balances other than zero. Sunny uses the periodic

The company uses uses all typical accounts used by a merchandising business. Listed below are accounts with balances other than zero. Sunny uses the periodic inventory system, records all sales and purchases by the gross method, and applies the cost method to account for treasury stock.

January transactions:

January 2

Issued $100,000, 5-year, debenture 4% bonds with a yield of 6%. Interest payable semiannually on June 30 and December 31. (DO NOT attempt to compute accrued interest; treat January 2 as if it had been an issuance on an interest payment date.)

3

Sold merchandise on account, FOB shipping point, 2/10,n/30, $5,900.

5

Purchased merchandise on account, FOB shipping point, n/45, $2,700.

7

Collected $6,000 from customers on account; no discounts taken.

8

Paid freight charges on merchandise purchased on Jan. 5, $180.

9

Paid creditors on account, $20,000; no discounts taken.

9

Received returned merchandise from sale of Jan. 3; granted customer credit of $300.

10

Cash sales for January 1 through 10 total $15,500.

11

Sold merchandise on account, FOB shipping point, 2/10,n/30, $2,800.

12

Paid January rent for the warehouse, $1,000.

14

Collected amount due from sale of January 11. Customer took advantage of discount.

15

Declared and paid $800 in dividends.

16

Purchased merchandise on account, FOB destination, 1/15,n/45, $30,400.

17

Paid cash for office supplies, $400.

18

Returned $200 of merchandise purchased on Jan. 16 receiving credit from supplier.

20

Cash sales for January 11 through 20 total $17,500.

21

Paid one-half of amount due on purchase of January 16 after consideration of Jan. 18 return. Took advantage of early pay discount.

22

Issued 90-day, 3%, $15,100 note payable for remainder of amount owed on Jan. 16 purchase.

23

Purchased new equipment by issuing 100 shares of stock at $12 per share and paying $5,000 in cash. In addition, paid installation costs of $500.

25

Sold for $350 old equipment with an original cost of $1,100 and accumulated depreciation of $650.

28

Recorded and paid monthly sales salaries of $4,300 and office salaries of $2,600.

30

Cash sales for January 21 through 30 total $19,920.

31

Paid $200 cash for repair and maintenance on existing equipment.

31

Announced a 2 for 1 stock split on all issued shares.

31

Purchased 50 shares of our own stock to hold temporarily paying $8 per share.

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

Handbook Of Energy Audits

Authors: Albert Thumann, William J. Younger

6th Edition

0824709985, 978-0824709983

More Books

Students also viewed these Accounting questions

Question

1. How can evolutionary theory explain prosocial behaviour?

Answered: 1 week ago