Question

journalism the adjusting entries at July 31 on hitz company’s books

10. Stan's Market recorded the following events involving a recent purchase of inventory: Received goods for $120,000, terms 2/10, n/30. Paid $600 freight on the shipment. Paid the invoice within the discount period. As a result of these events, the company's inventory a. increased by $120,000. b. increased by $118,200. c. increased by $120,600. d. increased by $117,600. 1. Two individuals at a retail store work the same cash register. You evaluate this

Answer 1

Solution of the above problem is as under:

Question 10) Option a) i.e. the company's inventory will be increased by $120000.

Explanation is as given below:

Stan's Market
Journal Entry
Account Titles and Explanation	Debit ($)	Credit ($)
Inventory A/c Dr.	120000
To Accounts Payable A/c		120000
(Being goods purchased on account)
Freight Expenses A/c	600
To Cash A/c		600
(Being freight paid)
Accounts Payable A/c Dr.	120000
To Cash A/c		117600
To Purchase Discount A/c		2400
(Being cash paid to creditors)

Solution: Ex 11-02

Cosimo Enterprises
Journal Entry for Notes Payable
Account Titles and Explanation	Debit ($)	Credit ($)
Merchandise Inventory A/c Dr.	260000
To 5% Notes PayableA/c		260000
(Being 45 days 5% note issued for merchandise inventory in favour of Dixon Industries)
5% Notes Payable A/c Dr.	260000
Interest Expense A/c Dr.	1625
To Cash A/c		261625
(Being payment made on due date)
Dixon Industries
Journal Entry for Receipt of Notes Payable
Account Titles and Explanation	Debit ($)	Credit ($)
5% Notes Receivable A/c Dr.	260000
To Sales A/c		260000
(Being inventory purchased with note)
Cash A/c Dr.	261625
To 5% Notes Receivable A/c		260000
To Interest Revenue a/c		1625
(Being note collected)