Question

8/20/2020 Comprehensive Accounting Cycle Review 5-1 (Part Level Submission) Print by: Misty McCurley AC201:AC2011NF1A2020 Principles Financial Accounting / AC201 - Extra Credit Opportunity 2 (Chapter 5 Comprehensive Problem) *Comprehensive Accounting Cycle Review 5-1 (Part Level Submission) On December 1, 2017, Devine Distributing Company had the following account balances. Debit Cash Accounts Receivable Inventory Supplies Equipment $7,300 5,000 12,400 1,500 22,000 $48,200 Accumulated Depreciation Equipment Accounts Payable Salaries and Wages Payable Common Stock Retained Earnings Credit $2,200 4,800 1,000 15,100 25,100 $48,200 During December, the company completed the following summary transactions. 10 Dec. Paid $1,900 for salaries due employees, of which $900 is for December and $1,000 is for 6 November salaries payable. 8 Received $1,800 cash from customers in payment of account (no discount allowed). Sold merchandise for cash $6,700. The cost of the merchandise sold was $3,900. 13 Purchased merchandise on account from Hecht Co. $9,400, terms 2/10, n/30. 15 Purchased supplies for cash $1,800. 18 Sold merchandise on account $12,400, terms 3/10, n/30. The cost of the merchandise sold was $8,200. 20 Paid salaries $1,600. 23 Paid Hecht Co. in full, less discount. 27 Received collections in full, less discounts, from customers billed on December 18. *(a) Journalize the December transactions using a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit

Answer 1

JOURNAL ENTRIES

Date	Account Details and Explanation	Debit ($)	Credit ($)
Dec 6	Salaries expenses	900
	Outstanding salary	1000
	Cash		1,900
	To record payment made of salary expenses and salaries Payable of november
Dec 8	Cash	1,800
	Account receivable		1,800
	To record cash received from customer
Dec 10	Cash	6,700
	Sales		6,700
	Cost of goods sold	3,900
	Merchandise Inventory		3,900
	To record sales made for cash
Dec 13	Merchandise Inventory	9,400
	Account payable		9,400
	To record purchase merchandise on account terms 2/10, n/30
Dec 15	Supplies expenses	1,800
	Cash		1,800
	To record purchase supplies for cash
Dec 18	Account receivable	12,400
	Sales		12,400
	Cost of goods sold	8,200
	Merchandise Inventory		8,200
	To record sales made on account terms 3/10, n/30
Dec 20	Salaries expenses	1,600
	Cash		1,600
	To record salaries paid
Dec 23	Account Payable	9,400
	Cash		9,212
	Discount received*		188
	To record paid Hecht company in full, less discount
Dec 27	Cash	12,028
	Discount allowed*	372
	Account receivable		12,400
	To record received collection in full, less discount from customer billed on December 18

Working note :

(1) Discount Received (2% of $9,400) = $188

(2) Discount Allowed (3%of $12,400) =$372