Question Details

Business A 654 CHAPTER 5 PART 11

CHAPTER 5 ACCOUNTING FOR MERCHANDISING OPERATIONS

BRIEF EXERCISES
BE 190
Presented here are the components in Bradley Company- income statement. Determine the missing amounts.
Sales 	Cost of	Gross	Operating	Net 
Revenue	Goods Sold	_Profit 	Expenses	Income
$75,000	(a)	$35,000	(b)	$17,000
	(c)	$86,000	$59,000	$48,000	(d)


BE 191
Prepare the necessary journal entries on the books of Kelly Carpet Company to record the following transactions, assuming a perpetual inventory system (you may omit explanations):
(a)	Kelly purchased $45,000 of merchandise on account, terms 2/10, n/30.
(b)	Returned $3,000 of damaged merchandise for credit.
(c)	Paid for the merchandise purchased within 10 days. 

BE 192
Garth Company sold goods on account to Kyle Enterprises with terms of 2/10, n/30. The goods had a cost of $600 and a selling price of $1,100. Both Garth and Kyle use a perpetual inventory system. Record the sale on the books of Garth and the purchase on the books of Kyle.


BE 193
Richter Company sells merchandise on account for $2,500 to Lynch Company with credit terms of 3/10, n/60. Lynch Company returns $200 of merchandise that was damaged, along with a check to settle the account within the discount period. What entry does Richter Company make upon receipt of the check and the damaged merchandise?


BE 194
Charlie Company uses a perpetual inventory system. During May, the following transactions and events occurred.

May	13	Sold 8 motors at a cost of $45 each to Scruffy Brothers Supply Company, terms 4/10, n/30. The motors cost Charlie $26 each.

May	16	One defective motor was returned to Charlie.

May	 23	Received payment in full from Scruffy Brothers. Round to nearest dollar.

Instructions
Journalize the May transactions for Charlie Company (seller) assuming that Charlie uses a perpetual inventory system.  You may omit explanations. Round amounts to nearest dollar.


BE 195
The income statement for Pepe Serna Company for the year ended December 31, 2014 is as follows:

PEPE SERNA COMPANY
Income Statement
For the Year Ended December 31, 2014
Revenues
	Sales revenue			$58,000
	Interest revenue			    3,000
		Total revenues			61,000
Expenses
	Cost of goods sold		$33,000
	Salaries and wages expense		13,000
	Interest expense		      1,000
		Total expenses			   47,000
Net income			$   14,000
Prepare the entries to close the revenue and expense accounts at December 31, 2014. You may omit explanations for the transactions.


BE 196
Hoyt Company provides this information for the month of November, 2014:  sales on credit $170,000; cash sales $70,000; sales discounts $2,000; and sales returns and allowances $9,000.  Prepare the sales revenues section of the income statement based on this information.


BE 197
During October, 2014, Red- Catering Company generated revenues of $14,000.  Sales discounts totaled $200 for the month.  Expenses were as follows: Cost of goods sold of $7,700 and operating expenses of $2,000.   

Calculate (1) gross profit and (2) income from operations for the month.


aBE 198
For each of the following, determine the missing amounts.  	Beginning		   Goods Available	Cost of	Ending 	Inventory	Purchases	    for Sale    	Goods Sold	Inventory
1.	$10,000	________	$  45,000	$25,000	_______
2.	  ______	$220,000	$265,000	_______	$40,000 

aBE 199
Assume that Swann Company uses a periodic inventory system and has these account balances:  Purchases $525,000; Purchase Returns and Allowances $14,000; Purchase Discounts $9,000; and Freight-In $15,000. Determine net purchases and cost of goods purchased.


aBE 200
Assume that Swann Company uses a periodic inventory system and has these account balances:  Purchases $630,000; Purchase Returns and Allowances $25,000; Purchase Discounts $11,000; and Freight-In $19,000; beginning inventory of $45,000; ending inventory of $55,000; and net sales of $750,000.  Determine the cost of goods sold.


aBE 201
Scruffy Brothers Supply uses a periodic inventory system. During May, the following transactions and events occurred.

May	13	Purchased 8 motors at a cost of $45 each from Charlie Company, terms 4/10, n/30.  The motors cost Charlie Company $26 each.

May	16	Returned 1 defective motor to Charlie.

May	 23	Paid Charlie Company in full. Round to nearest dollar.

Instructions
Journalize the May transactions for Scruffy Brothers. You may omit explanations.