Sales-Related Transactions
The debits and credits for four related entries for a sale of $15,000, terms 1/10, n/30, are presented in the following T accounts.
Cash | |||
---|---|---|---|
(5) | 13,860 |
Accounts Receivable | |||
---|---|---|---|
(1) | 14,850 | (3) | 990 |
(5) | 13,860 |
Merchandise Inventory | |||
---|---|---|---|
(4) | 575 | (2) | 8,800 |
Estimated Returns Inventory | |||
---|---|---|---|
(4) | 575 |
Customer Refunds Payable | |||
---|---|---|---|
(3) | 990 |
Sales | |||
---|---|---|---|
(1) | 14,850 |
Cost of Merchandise Sold | |||
---|---|---|---|
(2) | 8,800 |
Describe each transaction.
1. |
2. |
3. |
4. |
5. |
1:- Sold merchandise on account of gross sale of $15,000 and company using net method to record sale therefore net sales is $14850 ($15000 X 99℅ )
2. Recorded the cost of the merchandise sold of $8,800 and reduced the merchandise inventory account because company using prepetual method .
3. Accepted a return of merchandise and issued a credit memo of $990 which is less discount.
4. Recorded the merchandise returned cost of $575 for merchandise account
5. Received the due amount of Receivables of $13860 from customers .
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