Question

1. Journalize the following merchandise transactions: (a) Sold merchandise on account, $17,300, with terms 2/10, net 30. The cost of the merchandise sold was $12,600. (b) Received payment within the discount period. Mar. 3 2. Beginning inventory, purchases, and sales data for hammers are as follows: Inventory 12 units at $15 11 Purchase 13 units at $17 - 14 Sale 118 units Purchase 9 units at $20 Sale 10 units Assuming the business maintains a perpetual inventory system, complete the subsidiary inventory ledger and calculate the cost of merchandise sold and ending inventory under the following assumptions: (a) First-in, first-out Purchases Cost of Merchandise Sold Inventory Unit Cost Total Cost Unit Cost Total Cost Qty. Qty. Qty. Unit Cost Total Cost Date Mar. 3 11 14 21 25 Balances

Answer 1

1.

Date	Account title and explanation	Debit	Credit
(a)	Accounts receivable	17,300
	Sales revenue		17,300
	Cost of goods sold	12600
	Inventory		12600
(b)	Cash (17,300 x 98%)	16954
	Sales discount (17,300 x 2%)	346
	Accounts receivable		17,300

(a) First in first out Cost of Merchandise sold Purchases Inventory Qty. Unit cost Total cost Qty. Unit cost Total cost Qty. Unit cost Total cost Date $180 $221 $15 $17 Mar. 3 12. $17 $221 13 11 13 $15 $17 $180 $102 14 12 $119 $17 6 7 $180 $17 $20 $119 21 7 $180 $20 $17 $20 $119 7 $60 $461 $20 $120 $120 3 6 Balance 6 (b) Last in first out Cost of Merchandise sold Purchases Inventory Qty. Unit cost Total cost Qty. Unit cost Total cost Qty. Unit cost Total cost Date $15 $17 $180 Mar. 3 12 $17 $221 $221 11 13 13 $17 $15 $221 $75 14 13 $15 $15 $20 $105 5 7 $180 $105 $20 21 7 $180 $20 $15 $180 $15 $491 25 9 $90 $15 1 6 $90 Balance 28 6 LO 28 25

3.

1	N/A
2	Credit
3	N/A
4	Credit
5	Debit
6	N/A
7	N/A
8	Credit
9	N/A
10	N/A
11	Credit
12	N/A
13	N/A
14	Credit