Question

On March 1, Sather Co. sold merchandise to Boone Co. on account, $33,800, terms 2/15, n/30....

On March 1, Sather Co. sold merchandise to Boone Co. on account, $33,800, terms 2/15, n/30. The cost of the merchandise sold is $18,000. The merchandise was paid for on March 14. Assume all discounts are taken.

Required:

Journalize the entries for Sather Co. and Boone Co. (on seperate journals) for the sale, purchase, and payment of amount due. Refer to the appropriate company’s Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS Sather Co.General Ledger

ASSETS
110 Cash
121 Accounts Receivable-Boone Co.
125 Notes Receivable
130 Merchandise Inventory
140 Office Supplies
141 Store Supplies
142 Prepaid Insurance
180 Land
192 Store Equipment
193 Accumulated Depreciation-Store Equipment
194 Office Equipment
195 Accumulated Depreciation-Office Equipment
LIABILITIES
210 Accounts Payable
218 Sales Tax Payable
219 Customers Refunds Payable
220 Unearned Rent
221 Notes Payable
EQUITY
310 Owner, Capital
311 Owner, Drawing
312 Income Summary
REVENUE
410 Sales
610 Rent Revenue
EXPENSES
501 Cost of Merchandise Sold
521 Delivery Expense
522 Advertising Expense
524 Depreciation Expense-Store Equipment
525 Depreciation Expense-Office Equipment
531 Rent Expense
533 Insurance Expense
534 Store Supplies Expense
535 Office Supplies Expense
536 Credit Card Expense
539 Miscellaneous Expense
710 Interest Expense
CHART OF ACCOUNTS
Boone Co.
General Ledger
ASSETS
110 Cash
120 Accounts Receivable
125 Notes Receivable
130 Merchandise Inventory
140 Office Supplies
141 Store Supplies
142 Prepaid Insurance
180 Land
192 Store Equipment
193 Accumulated Depreciation-Store Equipment
194 Office Equipment
195 Accumulated Depreciation-Office Equipment
LIABILITIES
211 Accounts Payable-Sather Co.
218 Sales Tax Payable
219 Customers Refunds Payable
220 Unearned Rent
221 Notes Payable
EQUITY
310 Owner, Capital
311 Owner, Drawing
312 Income Summary
REVENUE
410 Sales
610 Rent Revenue
EXPENSES
501 Cost of Merchandise Sold
521 Delivery Expense
522 Advertising Expense
524 Depreciation Expense-Store Equipment
525 Depreciation Expense-Office Equipment
531 Rent Expense
533 Insurance Expense
534 Store Supplies Expense
535 Office Supplies Expense
536 Credit Card Expense
539 Miscellaneous Expense
710 Interest Expense

Homework Answers

Answer #1

Note:
I followed the perpetual Inventory system under net method due to no system / method mentioned in the question.

Calculation to find the discount (terms 2/15)
*
$33,800 X 2% = $676
$33,800 - $676 = $33,124

Sather Co.

Date Account Name / Explanation Account # Debit Credit
Mar 1 Account Receivable 120 33,124
Sales 410 33,124
(goods sold, terms 2/15, n/30)
Mar 1 Cost of Merchandise sold 501 18,000
Merchandise Inventory 130 18,000
(cost of sale)
Mar 14 Cash 110 33,124
Accounts Receivable 33,124

Boone Co.

Date Account Name / Explanation Account # Debit Credit
Mar 1 Merchandise Inventory 130 33,124
Account payable 210 33,124
(purchased goods, terms 2/15, n/30)
Mar 14 Account payable 210 33,124
Cash 110 33,124
(cash paid within a discount period)
*( $33,800 X 2% = 676)

* $33,800 - $676(discount) = $33,124 paid

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
On March 1, Sather Co. sold merchandise to Boone Co. on account, $31,800, terms 2/15, n/30....
On March 1, Sather Co. sold merchandise to Boone Co. on account, $31,800, terms 2/15, n/30. The cost of the merchandise sold is $19,000. The merchandise was paid for on March 14. Journalize the entries for Sather Co. and Boone Co. for the sale, purchase, and payment of amount due. Refer to the appropriate company’s Chart of Accounts for exact wording of account titles. Chart of Accounts-Sather Co. CHART OF ACCOUNTS Sather Co. General Ledger ASSETS 110 Cash 121 Accounts...
fast thumbs up!! Shore Co. sold merchandise to Blue Star Co. on account, $28,250, terms FOB...
fast thumbs up!! Shore Co. sold merchandise to Blue Star Co. on account, $28,250, terms FOB shipping point, 2/15, n/30. The cost of the goods sold is $19,550. Shore paid freight of $800. Journalize the entries for Shore and Blue Star for the sale, purchase, and payment of amount due. Refer to the appropriate company’s Chart of Accounts for exact wording of account titles. CHART OF ACCOUNTSShore Co.General Ledger ASSETS 110 Cash 121 Accounts Receivable-Blue Star Co. 125 Notes Receivable...
May 1. Sold merchandise on account to Beijing Palace Co., $36,000. The cost of the merchandise...
May 1. Sold merchandise on account to Beijing Palace Co., $36,000. The cost of the merchandise sold was $23,540. Aug. 30. Received $10,380 from Beijing Palace Co. and wrote off the remainder owed on the sale of May 1 as uncollectible. Dec. 8. Reinstated the account of Beijing Palace Co. that had been written off on August 30 and received $25,620 cash in full payment. Required: Journalize the above transactions in the accounts of Sedona Interiors Company, a restaurant supply...
Journalize entries for the following related transactions of Lilly Heating & Air Company. Refer to the...
Journalize entries for the following related transactions of Lilly Heating & Air Company. Refer to the Chart of Accounts for exact wording of account titles. A. Purchased $48,400 of merchandise from Schell Co. on account, terms 1/10, n/30. B. Paid the amount owed on the invoice within the discount period. C. Discovered that $7,600 of the merchandise purchased in (A) was defective and returned items, receiving credit. D. Purchased $5,900 of merchandise from Schell Co. on account, terms n/30. E....
ournalize the entries for the following transactions. Refer to the Chart of Accounts for exact wording...
ournalize the entries for the following transactions. Refer to the Chart of Accounts for exact wording of account titles. (Note: the company uses a clearinghouse to take care of all bank as well as non-bank credit cards used by its customers.) Mar. 1 Sold merchandise for cash, $33,900. The cost of the merchandise sold was $18,306. 10 Sold merchandise on account, $262,400. The cost of the merchandise sold was $141,696. 12 Sold merchandise to customers who used MasterCard and VISA,...
Journalize entries for the following related transactions of South Coast Heating & Air Company. Refer to...
Journalize entries for the following related transactions of South Coast Heating & Air Company. Refer to the Chart of Accounts for exact wording of account titles. Mar. 1 Purchased $48,000 of merchandise from Atlas Co. on account, terms 1/10, n/30. 9 Paid the amount owed on the invoice within the discount period. 11 Discovered that $7,500 of the merchandise purchases on Mar. 1 was defective and returned items, receiving credit. 18 Purchased $6,000 of merchandise from Atlas Co. on account,...
Journalize the entries to record the following selected transactions. Refer to the Chart of Accounts for...
Journalize the entries to record the following selected transactions. Refer to the Chart of Accounts for exact wording of account titles. A. Sold $61,700 of merchandise on account, subject to a sales tax of 6%. The cost of the goods sold was $38,720. B. Paid $40,670 to the state sales tax department for taxes collected. CHART OF ACCOUNTS General Ledger ASSETS 110 Cash 120 Accounts Receivable 125 Notes Receivable 130 Inventory 131 Estimated Returns Inventory 140 Office Supplies 141 Store...
On December 22, Travis Company purchased merchandise on account from a supplier for $11,100, terms 2/10,...
On December 22, Travis Company purchased merchandise on account from a supplier for $11,100, terms 2/10, net 30. Travis Company paid for the merchandise within the discount period on December 31. Required: Under a perpetual inventory system, record the journal entries required for the above transactions. Refer to the Chart of Accounts for exact wording of account titles CHART OF ACCOUNTS Travis Company General Ledger ASSETS 110 Cash 120 Accounts Receivable 125 Notes Receivable 130 Merchandise Inventory 131 Estimated Returns...
On December 28, Silverman Enterprises sold $18,500 of merchandise to Beasley Co. with terms 2/10, n/30....
On December 28, Silverman Enterprises sold $18,500 of merchandise to Beasley Co. with terms 2/10, n/30. The cost of the goods sold was $11,200. On December 31, Silverman prepared its adjusting entries, yearly financial statements, and closing entries. On January 3, Silverman issued Beasley a credit memo for returned merchandise. The returned merchandise originally cost Silverman $2,350 and was billed (invoiced) for $4,000 with terms 2/10, n/30. A. Journalize the entries by Silverman Enterprises to record the December 28 sale....
Purchase- Related Transaction The Stationery Company purchased merchandise on account from a supplier for $17,000 terms...
Purchase- Related Transaction The Stationery Company purchased merchandise on account from a supplier for $17,000 terms 2/10 n/30. The Stationery Company returned merchandise with invoice amount of $2, 200 and received full credit. a) If The Stationery Company pays invoice within the discount period, what is the amount of cash required for the payment? $____________. Determining Amounts to be Paid on Invoices Determine the amount to be paid in full settlement of each of the following invoices, assuming that credit...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT