Chapter 5 Bus1A Homework

Topics: Expense, Merchandising, Learning, Inventory, Income statement, FIFO and LIFO accounting / Pages: 11 (2511 words) / Published: Apr 28th, 2013
Assisnment PrintView

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10 points priceof purchased with an invoice taos Company merchandise resalefrom TusconCompany for Taospaidwithin the n160. merchandise costTuscon The had and termsof 2110, $14,322. $21,000 credit period. inventory system. Assume bothbuyer seller a perpetual that and use discount (Omit the "$" sign in your l(a)Prepare entriesthat the buyershouldrecordfor the purchase. response.) General Journal Merchandise inventory payable lAccounts Debit l,:J l Credit | 21,000

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(Omitthe "$" sign in your record the cashpayment. for 1(b)Prepare entries that the buyershould response.) General Journal




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(Omitthe "$" sign in your response.) Prepare record thesale. for 2(a) entries theseller that should General Journal lAccountsreceivable l:l

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(Omitthe "$" sign in your 2(b)Prepare for entries that the sellershould record the cashcollection. response.) General Journal I Cash l S a l e sd i s c o u n t s LJ ***'*"*1*1 t :,1



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Assume that the buyerborrowed enough cashto pay the balance the lastday of the discount on period an annual period. at interest of 11o/o paidit backon the lastdayof thecredit rate and Compute (Use 365 days a year. Round your how much the buyer saved by following this strategy. intermediate calculations and final answerto 2 decimalplaces.Omit the "$" sign in your response.)
Buyer'snet savings Explanation. 1.

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Assignment Print View
CashPayment: payable period. Paid account within discount 2% 3. Amount borrowed paywithdiscount $ 20,580 to x 11o/o Annual of interest

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