P5.2A (LO 2, 3, 5) Financial Statement Renner Hardware Store completed the following merchan- dising transactions in the month of May. At the beginning of May, the ledger of Renner showed Cash of $5,000 and Owner's Capital of $5,000. May 1 Purchased merchandise on account from Braun's Wholesale Supply $4,200, terms 2/10, n/30. 2 Sold merchandise on account $2,100, terms 1/10, n/30. The cost of the merchandise sold was $1,300. 5 9 10 11 Purchased supplies for cash $400. Purchased merchandise for cash $1,400. Received refund for poor quality merchandise from supplier on cash purchase $150. Purchased merchandise from Valley Distributors $1,300, FOB shipping point, terms 2/10, n/30. 19 Paid freight on May 17 purchase $130. 24 Sold merchandise for cash $3,200. The merchandise sold had a cost of $2,000. 25 Purchased merchandise on account from Lumley, Inc. $620, FOB destination, terms 2/10, n/30. Paid Valley Distributors in full, less discount. Made refunds to cash customers for defective merchandise $70. The returned merchandise had a fair value of $30. Sold merchandise on account $1,000 terms n/30. The cost of the merchandise sold was $560. 12 15 17 Received credit from Braun's Wholesale Supply for merchandise returned $300. Received collections in full, less discounts, from customers billed on sales of $2,100 on May 2. Paid Braun's Wholesale Supply in full, less discount. 27 29 31 Renner Hardware's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 301 Owner's Capital, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold. Instructions a. Journalize the transactions using a perpetual inventory system. b. Enter the beginning cash and capital balances and post the transactions. (Use J1 for the journal reference.) c. Prepare an income statement through gross profit for the month of May 2020. Journalize, post, and prepare a partial income statement. GLS c. Gross profit $2,379
P5.2A (LO 2, 3, 5) Financial Statement Renner Hardware Store completed the following merchan- dising transactions in the month of May. At the beginning of May, the ledger of Renner showed Cash of $5,000 and Owner's Capital of $5,000. May 1 Purchased merchandise on account from Braun's Wholesale Supply $4,200, terms 2/10, n/30. 2 Sold merchandise on account $2,100, terms 1/10, n/30. The cost of the merchandise sold was $1,300. 5 9 10 11 Purchased supplies for cash $400. Purchased merchandise for cash $1,400. Received refund for poor quality merchandise from supplier on cash purchase $150. Purchased merchandise from Valley Distributors $1,300, FOB shipping point, terms 2/10, n/30. 19 Paid freight on May 17 purchase $130. 24 Sold merchandise for cash $3,200. The merchandise sold had a cost of $2,000. 25 Purchased merchandise on account from Lumley, Inc. $620, FOB destination, terms 2/10, n/30. Paid Valley Distributors in full, less discount. Made refunds to cash customers for defective merchandise $70. The returned merchandise had a fair value of $30. Sold merchandise on account $1,000 terms n/30. The cost of the merchandise sold was $560. 12 15 17 Received credit from Braun's Wholesale Supply for merchandise returned $300. Received collections in full, less discounts, from customers billed on sales of $2,100 on May 2. Paid Braun's Wholesale Supply in full, less discount. 27 29 31 Renner Hardware's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 301 Owner's Capital, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold. Instructions a. Journalize the transactions using a perpetual inventory system. b. Enter the beginning cash and capital balances and post the transactions. (Use J1 for the journal reference.) c. Prepare an income statement through gross profit for the month of May 2020. Journalize, post, and prepare a partial income statement. GLS c. Gross profit $2,379
Chapter6: Merchandising Transactions
Section: Chapter Questions
Problem 1PB: Record journal entries for the following transactions of Furniture Warehouse. A. July 5: Purchased...
Related questions
Topic Video
Question
P5.2
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 5 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781305084087
Author:
Cathy J. Scott
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781305084087
Author:
Cathy J. Scott
Publisher:
Cengage Learning