Question

1. Nash's Trading Post, LLC recorded the return of $150 of goods originally sold on credit...

1. Nash's Trading Post, LLC recorded the return of $150 of goods originally sold on credit to Discount Industries. Using the periodic inventory approach, Nash's would record this transaction as:

Accounts Payable 150
          Sales Returns and Allowances 150
Sales Returns and Allowances 150
          Accounts Receivable 150
Accounts Receivable 150
          Sales Returns and Allowances 150
Inventory 150
          Accounts Receivable 150

2.

Blossom Company returned $310 of goods originally purchased on credit from Blue Spruce Industries. Using the periodic Inventory approach, Blossom would record this transaction as:

Inventory 310
          Accounts Payable 310
Accounts Payable 310
          Inventory 310
Purchase Returns and Allowances 310
          Accounts Payable 310
Accounts Payable 310
          Purchases Returns and Allowances 310

3.

Blue Spruce Corp. receives a payment on account from Ayayai Industries. Based on the original sale of $13000 using the periodic inventory approach, Blue Spruce Corp. honors the 3% cash discount and records the payment. Which of the following is the correct entry for Blue Spruce Corp. to record?

Accounts Receivable 13000
          Cash 8810
          Purchase Discounts 190
Cash 12610
Sales Discounts 390
          Inventory 13000
Cash 12610
Sales Discounts 390
          Accounts Receivable 13000
Cash 12610
Purchase Discounts 390
          Accounts Payable 13000

4.

On September 14, 2022, Pharoah Company sells merchandise valued at $25900 on account to Pacifica Inc. with terms 5/10, n/30. Both Pharoah and Pacifica use the periodic inventory system. Pacifica remits payment to Sampson on September 23.  Pharoah’s entry on that date is:

Accounts Receivable 25900
          Cash 25005
          Purchase Discounts 895
Cash 24605
Sales Discounts 1295
          Accounts Payable 25900
Cash 24605
Sales Discounts 1295
          Accounts Receivable 25900
Cash 24605
Sales Discounts 1295
          Accounts Payable 25900

5.

Cullumber Corporation purchases $1500 of merchandise on account from Enterprise Company, terms 5/10, n/30. Cullumber and Enterprise both use periodic inventory systems. Cullumber’s entry record this transaction is:

Purchases 1500
          Accounts Payable 1500
Inventory 1500
          Accounts Payable 1500
Accounts Payable 1500
          Inventory 1500
Accounts Payable 1500
          Purchases 1500
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Homework Answers

Answer #1

1.When goods are returned by customers

Sales Returns and Allowances 150
          Accounts Receivable 150

2.When goods are returned to supplier

Accounts Payable 310
          Purchases Returns and Allowances 310

3.When cash is collected from original sales

Cash 12610
Sales Discounts 390
Inventory

13000

4.When cash is collected from customers

Cash 24605
Sales Discounts 1295
          Accounts Receivable 25900

5.When goods are purchased from supplier

Purchases 1500
          Accounts Payable 1500

​​​​

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