Question

Theolowing information apples the questions des below The following data were selected from the records of Ses Comey for the year ended De Biances January 1Cum Accounts price of $600 a ctions and use the gross rood in the following order, except for cash sales the company sold merchandhedmade collections on dirms 30. 30 Transactions during Current Sold mechandise for cash 5236 000 Sold merchandise to R St ocence $9.500 Sold merchandise tok i 522.000 Two days her purchas e of the purchased in and received account credit Sold mechando o 28 000 IR Shades contend Collected $92.000 cothrom m et s on credit or you within the discount periods Three days atter paying the countik M etuned seven detectives and received a cash refund A ccomod code 500 cash on mac c onsenso a 1 Wote ott a proyer of 52000 dength the o w never be collected The state added by the content of credito

Answer 1

Sales discount (taken) Sales Returns and Allowances Bad debt expense Calculation Sykes Company Transaction Sales Revenue 236,000 9,500 22,000 OOOO - 60 16 =9,500/600*1 28,000 285 2,760 660 =9,484*3% =92,000*3% =22,000*3% - 25,500 (8) - 257 =257*3% =22,000/600*7 - m Workings below 847 847 Totals 321,000 3,697 273 Note In g, if $92,000 is accounts receivable & not cash collected, then discount to be $2,760 (92,000/100*3) If $92,000 is said to be cash collected from customers, then its after discount of 3% So taking that as 97%, calculate what 3% of sales discount would be $2,845 (92,000/97*3)

Sykes Company Journal entries Date Account a Cash Sales Revenue Credit Calculation Debit $ 236,000 $ 236,000 b $ 9,500 Accounts Receivable Sales Revenue $ 9,500 C $ 22,000 Accounts Receivable Sales Revenue $ 22,000 d $ 16 =9,500/600*1 Sales Returns and Allowances Accounts Receivable $ 16 $ 28,000 Accounts Receivable Sales Revenue $ 28,000 Cash Sales Discounts Accounts Receivable $ $ 9,200 285 =9,484*3% =9,500-16 $ 9,484 Cash Sales Discounts Accounts Receivable $ 89,240 $ 2,760 =92,000*3% $ 92,000 h Cash Sales Discounts Accounts Receivable $ 21,340 $ 660 =22,000*3% $ 22,000 $ 25,500 Accounts Receivable Sales Revenue $ 25,500 $ 257 Sales Returns and Allowances Sales Discounts Cash =22,000/600*7 =257*3% $ $ 8 249 k $ 5,000 Cash Accounts Receivable $ 5,000 Allowance for doubtful accounts Accounts Receivable $ 2,000 $ 2,000 m $ 847 Bad debt expense Allowance for doubtful accounts Workings below 847 $ b $ 9,500 $ 22,000 $ 28,000 $ 25,500 Workings Bad debt expense Credit Sales Credit sales Credit sales Credit sales Credit sales Total Credit Sales Returns Credit sales returns Credit sales returns Total Total Credit Sales, net of returns Bad debt expense $ 85,000 d $ $ 16 257 $ 273 $ 84,728 $ 847 =84,728*1%