Question

Can someone please solve S5-4 and S5-6?

Store S5-4 Journalizing sales transactions nalize the following sales transactions for Salem Sportswear. Explanations are not our required. The company estimates sales returns at the end of each month . 1 Salem sold $20,000 of men's sportswear for cash. Cost of goods sold is $10,000. Salem sold $62,000 of women's sportswear on account, credit terms are 3/10, n/30. Cost of goods is $31,000 Salem received a $4,500 sales return on damaged goods from the customer on July 1. Cost of goods damaged is $2,250 Salem receives payment from the customer on the amount due, less discount. 3 5 10 S5-5 Estimating sales returns On December 31, Jack Photography Supplies estimated that approximately 200 of merchandise sold will be returned. Sales Revenue for the year was $80,000 with a cost of $48,000. Journalize the adjusting entries needed to account for the estimated returns S5-6 Journalizing purchase and sales transactions Suppose Piranha.com sells 3,500 books on account for $17 each (cost of these boo is $35,700) on October 10, 2018 to The Textbook Store. One hundred of these books (cost $1,020) were damaged in shipment, so Piranha.com later received the damaged goods from The Textbook Store as sales returns on October 13,2018. Requirements 1. Journalize The Textbook Store's October 2018 transactions. 2. Journalize Piranha.com's October 2018 transactions. The company estimates sales returns at the end of each month

Answer 1

Assuming salem is following perpetual method of inventory S5-4 Journal Salem sportwear Date Particulars Cash Afc Dr Sales (being goods sold) LR Jul, 1 20,000 20,000 COGS To Inventory (being inventory transfer to COGS 10,000 10,000 ul. 3 Account Receivable To sales (being goods sold on Credit with 3/10, n/30 Discount) 62,000 62,000 3%/10 net 30 is a way of providing cash discounts on purchases. It means that if the bill is paid within 10 d there is a 3% discount COGS To Inventory (being inventory transfer to COGS 31,000 31,000 Jul. 5 Sales return and allowances To Cash (being sales return which sold on July 1. 4,500 4,500 Inventory To COGS (being Stock Transfer) 2,250 2,250 Cash Discount On sale To Account Receivable (Being cash received and Cash Discount given) Jul. 10 60,140 1,860 62,000

S5-5 As There is Right of Return Exists Journal Salem wear LR Dr.$Cr. S 1,600 Date Dec. 31 Sales return and allowances To Account Receivable (Being sales Adjusted) Any sales made with a right of return in which the revenue recognition criteria are met revenue and cost of sales reported in the income statement shall be reduced to reflect estimated returns Inventory - Right to Return To Cost of goods Sold on estimated return Being Cost Of goods sold Adjusted) 960 960 S5-6 55-6 Journal Textbook Store's Journal Piranha.com's Date LR Dr. Cr Date Particulars LR Dr Cr Oct. 10 2018 Inventory 59,500 Oct. 10 2018 Sales 59,500 To Account Payable Being sales Adjusted) 59,500 To Account Receivable 59 (being goods sold ) Oct. 13 2018 Account Payable 1,700 COGS To Inventory (being inventory transfer to COGS 35,700 To Inventory 1,700 35,7 Being Cost Of goods sold Adjusted) Oct. 13 2018 Sales return and allowances 1,700 To Account Receivable (sales Return) 1,020 To COGS (being Stock Transfer) 1,02