Question

On April 6. Home Furnishings purchased $45,000 of merchandise from Una's Imports, terms 1/10, 1/45. On April 8, Home Furnishings returned $9,500 of the merchandise to Una's Imports for credit. Home Furnishings paid cash for the merchandise on April 15 Required a. What is the amount that Home Furnishings must pay Una's imports on April 15? b. Record the events in a horizontal statements model in the Cash Flow column, use OA to designate operating activity, IA for Investing activity, FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cell blank c. How much must Home Furnishings pay for the merchandise purchased if the payment is not made until April 20? d. Record the payment of the merchandise in Requirement (c) in a horizontal statements model. In the Cash Flow column, use OA to designate operating activity. IA for investing activity. FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cel blank Complete this question by entering your answers in the tabs below. Required A Required Required Required Record the events in a horizontal statements model. In the Cash Flow column, use to designate operating activity, IA for investing activity, FA for financing activity, or If the element is not affected by the event, leave the cell blank. (Enter any decreases to account balances and cash outflows with a minus in Not all cells require entry) HOME FURNISHINGS Effect of Events on the Financial Statements Balance Sheet Income Statement Stockholders' Equity Accounts Net Common Retained Revenue Expenses Payable Stock Income Earnings Events Cash Merchandise Inventory Statement of Cash Flows Purchase inventory Return inventory Record discount Pald accounts payable < Required A Required C>

Answer 1

Answer a.

Amount to be paid = 45000 - 9500 = 35500 - [35500* 1/100 ] = 35500 - 355 = 35145

Answer b.

	Assets	Liabilities	Stockholder's Equity	Income Statement
Event	Cash	Merchandise Inventory	Accounts Payable	Common Stock	Retained earnings	Revenue	Expenses	Net Income	Statement of Cash Flows
Purchase Inventory		$45,000	$45,000
Return Inventory		$ (9500)	$ (9500)
Discount percentage		$  (355)	$ (355)
Paid Accounts payable	$  (35145)		(35145)						$ (35145) OA

Answer c.

Amount to be paid = Total merchandise purchased – Merchandise value returned.

= 45000 - 9500 = 35500

Answer d.

	Assets	Liabilities	Stockholder's Equity	Income Statement
Event	Cash	Merchandise Inventory	Accounts Payable	Common Stock	Retained earnings	Revenue	Expenses	Net Income	Statement of Cash Flows
Paid Accounts payable	$ (35500)		$ (35500)						$ (35500) OA