Question

4-26A Comprehensive cycle problem: Perpetual system LO 4-2, 4-3, 4-4, 4-5, 4-6, 4-7 [The following information applies to the questions displayed below.] At the beginning of Year 2, the Redd Company had the following balances in its accounts: Part 2 of 5 10 points Cash Inventory Land Common stock Retained earnings $ 6,900 15,80 ,000 15,000 13,980 eBook During Year 2. the company experienced the following events: Ask References 1. Purchased inventory that cost $5,200 on account from Ross Company under terms 1/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of $190 were paid in cash. 2. Returned $400 of the inventory it had purchased from Ross Company because the inventory was damaged in transit. The seller agreed to pay the return freight cost. 3. Paid the amount due on its account payable to Ross Company within the cash discount period. 4. Sold inventory that had cost $6.800 for $12,100 on account, under terms 2/10,n/45. 5. Received merchandise returned from a customer. The merchandise originally cost $900 and was sold to the customer for $1.680 cash. The customer was paid $1,680 cash for the returned merchandise. 6. Delivered goods FOB destination in Event 4. Freight costs of $140 were paid in cash. 7. Collected the amount due on the account receivable within the discount period. 8. Sold the land for $8.500. 9. Recognized accrued interest income of $600. 10. Took a physical count indicating that $13,400 of inventory was on hand at the end of the accounting period. (Hint: Determine the current balance in the inventory account before calculating the amount of the inventory write-down.) Problem 4-26A Part b b. Record the events in general journal format. Assume that the perpetual inventory method and gross method is used. (If no entry is required for a transaction/event, select "No journal entry required" In the first account field.)

Answer 1

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X х 7 Cla 9.aug - Microsoft Excel Home Insert Page Layout Formulas Data Review View X 4 Cut Σ AutoSum Times New Rom 11 A A 2 Wrap Text General ECopy Fill Paste BI U ra Merge & Center 4.0 .00 .00 0 Insert Delete Format Format Painter 2 Clear Conditional Format Cell Formatting as Table - Styles Styles Sort & Find & Filter - Select Editing Clipboard Font Alignment Number Cells M23 fic A B C D E F H I J K L M N 1 2 Credit Date 1 Debit 5390 3 4 5200 190 5 Date Accounts Debit Credit 8 Cash 8500 Gain on sale of land 15001 Land 7000 9 Interest Receivables 600 Interest Revenue 600 10 COGS 690 Current balance in Inventory(Before Adjusting Write down) Inventory 690 6 2 400 7 400 3 4800 14090 8 9 48 4752 10 11 4 12100 12 12100 Accounts Inventory Accounts Payable Cash Accounts Payable Inventory Accounts Payable Discount Received Cash Accounts Receivables Sale COGS Inventory Sales Return Cash Inventory COGS Freight Outward Cash Cash Discount allowed Accounts Receivables 13 4a 6800 14 6800 5 1680 15 16 1680 17 5a 900 18 900 19 6 140 20 140 21 7 11858 242 22 12100 I 23 24 25 Sheet1 Sheet2 Sheet4 Sheet3 Sheet6 Sheets Sheets Sheet7 Sheetz Sheets Sheet10 Sheet10 Sheet14 Sheet13 , IIII Ready BO 100% + O 07:06 22-09-2020

X х Cla 9 9.aug - Microsoft Excel Home Insert Page Layout Formulas Data Review View X * Cut AutoSum - Times New Rom - 11 - A A A 2 Wrap Text General La Copy Fill - Paste BI U ra Merge & Center 4.0 .00 .00 0 Insert Delete Format Format Painter Conditional Format Cell Formatting as Table - Styles Styles 2 Clear - Sort & Find & Filter Select Editing Clipboard Font Alignment Number Cells A17 for A B С C D E F G H I J K L 1 2 Credit Credit 3 4 5200 190 =+13-J5 7000 5 Date Accounts Debit 8 Cash 8500 Gain on sale of land Land 19 Interest Receivables 600 Interest Revenue 10 =+C13 =+J9 =+C14 6 =+D6 =+16 7 8 9 Current balance in Inventory(Before Adjusting Write down) =15000+D3-E7-E14+D17 =+L8-13400 =+D8-E10 =+(E4-D6*(100-1)% 10 11 12 =+D11 Date Accounts Debit 1 Inventory =+E4+E5 Accounts Payable Cash 12 2 =+C4 400 =+C3 3 =+C6 =+E4-D6 Discount Receiver =+C5 4 Accounts Receiva 12100 Sale 4a COGS 6800 =+C7 5 Sales Return 1680 Cash 5a =+C14 900 =+C13 6 Freight Outward 140 Cash 7 =+C20 =+E23-D22 Discount allowed =+E23*2% =+C11 13 14 =+D13 15 16 =+D15 17 18 900 19 20 =+D19 21 22 =+E12 23 24 25 KI Sheet1 Sheet2 Sheet4 Sheet3 Sheet6 Sheet9 Sheets Sheet7 Sheets Sheet10 Sheet10 Sheet14 Sheet13 0 IIII Ready B!!! 100% + O 07:07 22-09-2020