Dan Watson started a small merchandising business in Year 1. The business experienced the following events during its first year of operation. Assume that Watson uses the perpetual inventory system. 8 1. Acquired $25,500 cash from the issue of common stock. 2. Purchased inventory for $20,400 cash. 3. Sold inventory costing $18,900 for $30,000 cash. Required: a. Use a horizontal financial statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. More specifically, record the amounts of the events into the model. Also, in the Statement of Cash Flows column, classify the cash flows as operating activities (OA), investing activities (IA), or financing activities (FA). b. Prepare an income statement for Year 1 (use the multistep format). c. What is the amount of total assets at the end of the period?
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- Comfy Recliner Chairs completed the following selected transactions: i (Click the icon to view the transactions.) Record the transactions in the journal of Comfy Recliner Chairs. Explanations are not required. (Round to the nearest dollar.) (Record debits first, then credits. Exclude explanations from journal entries. For notes stated in days, use a 365-day year.) Begin with the transactions for 2024. Jul. 1: Sold inventory to Good - Mart, receiving a $37,000, nine-month, 14% note. Ignore Cost of Goods Sold. Date Debit Credit 2024 Jul. 1 Accounts C More info 2024 Jul. 1 Oct. 31 Dec. 31 Dec. 31 2025 Apr. 1 Jun. 23 Aug. 22 Nov. 16 Dec. 5 Dec. 31 Sold merchandise inventory to Good-Mart, receiving a $37,000, nine-month, 14% note. Ignore Cost of Goods Sold. Recorded cash sales for the period of $21,000. Ignore Cost of Goods Sold. Made an adjusting entry to accrue interest on the Good-Mart note. Made an adjusting entry to record bad debt expense based on an aging of accounts receivable. The…Dan Watson started a small merchandising business in Year 1. The business experienced the following events during its first year of operation. Assume that Watson uses the perpetual inventory system. 1. Acquired $30,500 cash from the issue of common stock. 2. Purchased inventory for $24,400 cash. 3. Sold inventory costing $15,500 for $31,500 cash. Required a. Record the events in general journal format. b. Post the entries to T-accounts. c. Determine the amount of gross margin.. d. What is the amount of net cash flow from operating activities for Year 1? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Record the events in general journal format. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction listAnalyze transactions and make and post journal entries.Makeadjusting entries, produce financial statements, and close nominal accounts. Selfish Gene Company is a merchandising firm. The following events occurredduring the month of May. ( Note: Selfish Gene maintains a perpetual inventorysystem.) Instructions:1.Record the preceding events in general journal form. 2.Which event do you think had the most significant economic impact on SelfishGene Company? Are all economically relevant events recorded in the financialrecords?
- The following transactions occurred during December, the first month of operations for Harris Company. Prepare journal entries to record each transaction. 1) Purchased $500 of inventory on account. 2) Purchased $300 of inventory on account. 3) Paid suppliers $600. 4) Purchased $400 of inventory on account. 5) Paid suppliers $300. Debit Credit Inventory Accounts payable 1) To record purchase of inventory on account. Cash Inventory 2) To record purchase of inventory on account. Cash Inventory 0 x 3) To record payment to suppliers. Cash Inventory 4) To record purchase of inventory on account. Cash Inventory 0 x 5) To record payment to suppliers. Post the transactions (in order) to the accounts payable T-account. (Enter your answers in the first available field under the appropriate debit or credit column.) Accounts Payable Balance 0 x5) The trial balance for a merchandiser, before the journal entries below, is as follows. A physical count of inventory at the end of the accounting year reveals $28,000 of inventory on hand. (Assume a perpetual inventory system.) Debit Credit Cash $12,600 2,400 800 Accounts Receivable Prepaid Rent Merchandise Inventory Accounts Payable Salaries Payable Notes Payable Yung, Capital Yung, Withdrawals Sales Revenue Cost of Goods Sold Delivery Expense Salaries Expense Rent Expense Selling Expense Supplies Expense Total 30,000 $ 4,200 1,000 800 13,800 1,000 96,000 23,000 2,000 21,000 14,000 8,500 500 $115,800 $115,800 Prepare the journal entry to record the inventory shrinkage and prepare all closing entries. (Can you help solve this & explain the answers. Thank you Plum Corporation began the month of May with $900,000 of current assets, a current ratio of 2201, and an acid-test ratio of 1.30.1. During the month, it completed the following transactions (the company uses a perpetual inventory system). Hay 2 Purchased $75,000 of merchandise inventory on credit. May 8 Sold merchandise inventory that cost $45,0e0 for $125,000 cash. May 10 Collected $22,000 cash on an account receivable. May 15 Paid $27,500 cash to settle an account payable. May 17 Wrote off a $5,0e0 bad debt against the Alilowance for Doubtful Accounts account. May 22 Declared a $1 per share cash dividend on its 68,000 shares of outstanding common stock. May 26 Paid the dividend declared on May 22. May 27 Borrowed $85,000 cash by giving the bank a 30-day, 10% note. May 28 Borrowed $105,e00 cash by signing a long-tere secured note. May 29 Used the $190,000 cash proceeds from the notes to buy new machinery. Required: Complete the…
- The accountant for Dolfin Company prepared the following income statement. The auditor has asked you to use this statement to provide additional information to Dolfin Company on the Final Questions panel. Dolfin Company Income Statement For the Year Ended December 31, 2020 1 Sales $316,840.00 2 Expenses: 3 Cost of merchandise sold $215,451.20 4 Selling expenses 41,189.20 5 Administrative expenses 34,852.40 6 Interest expense 275.00 7 Total expenses 291,767.80 8 Net income $25,072.20 Final Questions The auditor has asked you to prepare additional information about Dolfin Company’s results for last year. Use the data shown on the income statement in your computations. 1. Compute the operating expenses for Dolfin Company. 2. Compute the gross profit for Dolfin Company. 3. Compute the income from operations for…Prepare the journal entry for the following transactions using periodic inventory system: Jan. 2 Invested cash to the business and set up the company’s bank account thru BDO, P1,200,000. Jan. 3 Purchased office equipment to Southbound Computer Center for business use, P50,000. Payment terms: Open account, n/30 Jan. 4 Paid 1-year annual rent in advance, P60,000. Asset method will be used. Jan. 5 Purchased the following merchandise from Rebis Co.:• 300 reams of bond paper (P300 list price per ream)• 500 pieces of ballpen (P5 list price per piece)• 100 pieces of standard calculator (P400 list price per piece)Payment terms: Trade discount on total cost of 10%, cash discount of 2/10, n/30. Jan. 6 Paid freight costs on January 5 purchase, P1,000. Jan. 7 Contract signing with her assistant, with an average salary rate of P300/day. Jan. 9 Returned 5 pieces of standard calculator to Rebis Co. due to product defects. Credit memo made by Rebis were received that day.Required information [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: Cash Inventory Common stock Retained earnings $ 8,800 2,800 8,300 3,300 During Year 2, the company experienced the following events: 1. Purchased inventory that cost $6,300 on account from Ross Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of $580 were paid in cash. 2. Returned $400 of the inventory that it had purchased 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 $9,800 on account, under terms 2/10, n/45. 5. Received merchandise returned from a customer. The merchandise originally cost $580 and was sold to the customer for $880 cash. The customer was paid $880 cash for the…
- (B) Zeal Inc. Incorporation completed the following merchandising transactions in the month of May. At the beginning of May, the ledger of Zeal Inc. showed Cash of $8,000 and Zeal Inc., Capital of $45,000. Zeal Inc. incorporation follows the perpetual inventory system. May 3: Sold merchandise for cash to Seliece Co., $5,400. The cost of the merchandise sold was $4,800. May 6: Purchased merchandise on account from Rendick Co., $8,000, terms FOB Destination, 5/10, n/30, The relevant company paid the freight charge of $100. May 7: Purchased Equipment on credit $45,000. The equipment will be used by the business. May 8: Received $500 credit for merchandise inventory returned to Rendick Co. May 12: Paid Rendick Co. in full. May 15: Made refunds to Seliece Co. for defective merchandise $400. The returned merchandise had a scrap value of $50 only. Instructions: Journalize the above transactionsInventory at the beginning of the year cost $13,900. During the year, the company purchased (on account) inventory costing $86,500. Inventory that had cost $82,500 was sold on account for $97,000. Required: a. Calculate the amount of ending inventory. b. What was the amount of gross profit? c. Prepare journal entry to record sale of inventory assuming a perpetual system is used. Debit Credit AccountRite Shoes was involved in the transactions described below. Purchased $9,500 of inventory on account. Paid weekly salaries, $1,050. Recorded sales for the first week: Cash: $8,400; On account: $6,600. Paid for inventory purchased in event (1). Placed an order for $7,500 of inventory. Required: Prepare the appropriate journal entry for each transaction. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.