Question

TERE TUPPLE IS 6.16 184 serie REL SAVIN 04 visit 0.10/581 ....******* 11/11 stes D .. l Court Total Fu. Som restria ARD SAV o 3 Points Points Points 12 so19 1857.58 22 Calores MOH BE 8-4 Purchase discounts; gross method On December 28, 2021, Videotech Corporation (VTC) purchased 10 units of a new satellite uplink system from Tristar Communications for $25,000 each. The terms of each sale were 1/10, n/30. VTC uses the gross method to account for purchase discounts and a perpetual inventory system. VTC paid the net-of-discount amount on January 6, 2019. Prepare the journal entries on December 28 and January 6 to record the purchase and payment. E 8-5 Periodic inventory system; missing data The Playa Company uses a periodic inventory system. The following information is taken from Playa's records. Certain data have been intentionally ožitted (5 in thousands) 2021 2022 2023 Beginning inventory 876-bol 275 2ud? 225 logarS = BIH Nor or Ending + LDA 1 275 290? 225 EN

Answer 1

Gross Method of accounting means that the sales is accounted based on the invoice value without considering the cash discounts offered and discount will be passed when the payment is received within the discount period. "Credit term of 1/10, n/30" means that payment is be done in 30 days and if made within 10 days then 1% discount will be given Date General Journal Debit Credit Dec 28, 2021 Merchandise Inventory (10 x $25000] $250,000 Accounts Payable $250,000 (To record purchase of good) Jan 9, 2022 Accounts Payable $250,000 Merchandise Inventory ($250000 x 1%] $2,500 Cash $247,500 (To record payment made to vendor)