Question

Gordon's Grocers purchases bread from Buddy’s Bread Company at $1.80 per loaf. Gordon's recently engaged in...

Gordon's Grocers purchases bread from Buddy’s Bread Company at $1.80 per loaf. Gordon's recently engaged in a customer service contract with Buddy's to purchase 464,000 loaves of Buddy's bread. Buddy offered credit to Gordon's at terms of 1/15, n/30. Buddy expects Gordon to pay within the discount period.

Required:

Prepare the journal entry to record the sale using the net method, rounding to the nearest whole dollar.

Hint: In calculating your answer, use one minus the discount rate (eg. 1 - 0.01 = 0.99)

Accounts Receivable
Sales Revenue
Record sale

Then, prepare the journal entry assuming the payment is made within 15 days (the discount period). If required, round your answers to nearest whole dollar.

Cash
Accounts Receivable
Record collection within discount period
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Prepare the journal entry to record the sale using the net method, rounding to the nearest whole dollar.

Hint: In calculating your answer, use one minus the discount rate (eg. 1 - 0.01 = 0.99)

Accounts Receivable (464000*1.8*99%) 826848
Sales Revenue 826848
Record sale

Then, prepare the journal entry assuming the payment is made within 15 days (the discount period). If required, round your answers to nearest whole dollar.

Cash 826848
Accounts Receivable 826848
Record collection within discount period
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Problem 8-4 Mitchell and O’Brien, CPAs, PC, earned $135,000 in revenue from providing tax return preparation...
Problem 8-4 Mitchell and O’Brien, CPAs, PC, earned $135,000 in revenue from providing tax return preparation services to businesses and individuals. All services are provided on account. To encourage prompt payment, the firm uses credit terms of 3/10, n/30 when billing clients. Required: 1.            Prepare the journal entry to record revenues under the gross method. 2.            Prepare the journal entry to record collection of the accounts receivable, assuming clients pay within the 10-day discount period. 3.            Prepare the journal entry...
Kraft Foods Inc. is the second-largest food company in the world. Assume the company recently reported...
Kraft Foods Inc. is the second-largest food company in the world. Assume the company recently reported the following amounts in its unadjusted trial balance (in millions) as of December 31, 2017: Debits Credits Accounts Receivable $ 5,740 Allowance for Doubtful Accounts $ 220 Sales (assume all on credit) 49,700 Required: 1. Assume Kraft uses ½ of 1 percent of sales to estimate its Bad debt expense for the year. Prepare the adjusting journal entry required for the year, assuming no...
Kraft Foods Inc. is the second-largest food company in the world. Assume the company recently reported...
Kraft Foods Inc. is the second-largest food company in the world. Assume the company recently reported the following amounts in its unadjusted trial balance (in millions) as of December 31, 2017: Debits Credits   Accounts Receivable $ 5,920   Allowance for Doubtful Accounts $ 154   Sales (assume all on credit) 56,400 Required: 1. Assume Kraft uses ½ of 1 percent of sales to estimate its Bad debt expense for the year. Prepare the adjusting journal entry required for the year, assuming no...
Selkirk Company obtained a $20,000 note receivable from a customer on January 1, 2018. The note,...
Selkirk Company obtained a $20,000 note receivable from a customer on January 1, 2018. The note, along with interest at 12%, is due on July 1, 2018. On February 28, 2018, Selkirk discounted the note at Unionville Bank. The bank’s discount rate is 15%. Required: Prepare the journal entries required on February 28, 2018, to accrue interest and to record the discounting for Selkirk. Assume that the discounting is accounted for as a sale. (If no entry is required for...
Samberg Inc. had the following transactions. Oct. 1 – Sold $14,000 of merchandise on account, 2/10,...
Samberg Inc. had the following transactions. Oct. 1 – Sold $14,000 of merchandise on account, 2/10, n/30 to McCormick Industries. Nov. 1 – Received a $14,000, 90-day, 11% note from McCormick Industries to settle its $14,000 unpaid balance. Dec. 31 – Accrued interest on the note. (Round your answer to the nearest whole dollar amount.) Jan. 31 – Received the interest on the note’s maturity date. Jan. 31 – Received the principal on the note’s maturity date. (Round your answer...
On August 2, Jun Co. receives a $7,400, 90-day, 13.5% note from customer Ryan Albany as...
On August 2, Jun Co. receives a $7,400, 90-day, 13.5% note from customer Ryan Albany as payment on his $7,400 account receivable. Prepare Jun's journal entry assuming the note is honored by the customer on October 31 of that same year. (Do not round intermediate calculations. Round your answers to nearest whole dollar value. Use 360 days a year.) Record cash received on note plus interest. Note: Enter debits before credits. Date General Journal Debit Credit Oct 31 Prepare journal...
1. Purchases, $96​; Gross​ Sales, $176​; Sales Returns and​ Allowances, $15​; Sales​ Discounts, $24​; Operating​ Expenses,...
1. Purchases, $96​; Gross​ Sales, $176​; Sales Returns and​ Allowances, $15​; Sales​ Discounts, $24​; Operating​ Expenses, $55​; Net​ Sales, $137​; ​Freight-In, $9​; Beginning​ Inventory, $18​; Ending​Inventory, $8​; Net​ Purchases, $62​; Cost of Goods​ Sold, $ 81 a. The gross profit is __ ​(Use parentheses or a minus sign to show a net​ loss.) b. The net income or net loss is __ 2. ​Jack's Online Service on April 30 has the following account​ balances: Sales $27,000 Sales Returns and Allowances...
Samberg Inc. had the following transactions. a. Oct. 1-Sold $22,000 of merchandise on account, 1/10, n/30...
Samberg Inc. had the following transactions. a. Oct. 1-Sold $22,000 of merchandise on account, 1/10, n/30 to McCormick Industries b. Nov. 1-Received a $22,000, 90-day, 9 % note from McCormick Industries to settle its $22,000 unpaid balance c. Dec 31- Accrued interest on the note. (Round your answer to the nearest whole dollar amount.) d. Jan. 31-Received the interest on the note's maturity date. e. Jan. 31-Received the principal on the note's maturity date. (Round your answer to the nearest...
True or False 1. A company makes a credit sale for $500. Future collection from the...
True or False 1. A company makes a credit sale for $500. Future collection from the customer is probable. The company will not record revenue from the transaction until it collects cash from the customer. 2. Credit sales involve benefits and costs. A benefit of selling on credit is that the seller makes it more convenient for customers to purchase goods and services. A cost of selling on credit is that there is a delay in collecting cash from customers....
To raise operating funds, Signal Aviation sold an airplane on January 1, 2021, to a finance...
To raise operating funds, Signal Aviation sold an airplane on January 1, 2021, to a finance company for $770,000. Signal immediately leased the plane back for a 13-year period, at which time ownership of the airplane will transfer to Signal. The airplane has a fair value of $800,000. Its cost and its book value were $600,000. Its useful life is estimated to be 15 years. The lease requires Signal to make payments of $102,771 to the finance company each January...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT