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1. BE.05-01.ALGO (Algorithmic) Gross Profit During the current year, merchandise

ID: 2332674 • Letter: 1

Question

1. BE.05-01.ALGO (Algorithmic) Gross Profit During the current year, merchandise is sold for $150,500 cash and $653,400 on account. The cost of the goods sold is $522,500. What is the amount of the gross profit? 2. BE.05-02.ALGO (Algorithmic) Purchases Transactions Barans Company purchased merchandise on account from a supplier for $8,800, terms 2/10, /30. Barans returned $1,900 of the merchandise and received full credit. a. If Barans Company pays the invoice within the discount period, what is the amount of cash required for the payment? If required, round the answer to the nearest dollar. b. What account is debited by Barans Company to record the return? 3. BE.05-03.ALGO (Algorithmic) Sales Transactions Joumalize the following merchandise transactions: a. Sold merchandise on account, $10,100 with terms 1 /10, n/30. The cost of the goods sold was $6,050 Sale Cost b. Received payment less the discount. c. Refunded $470 to customer for defective merchandise that was not returned.

Explanation / Answer

1.

2A. Term 2/10 means if company paid within 10 days, they will get a cash discount

2B. Journal entry

Please note that Only one question can be answered at a time

but here i have answered 2 questions

Sales ($150,500+653,400) $   803,900 Less: Cost of goods sold $ (522,500) Gross profit $   281,400