value 0.50 points E6-18 Determining the Effects of Credit Sales, Sales Discounts

Question

value 0.50 points E6-18 Determining the Effects of Credit Sales, Sales Discounts, and Sales Returns and Allowances Rockland Shoe Company records Sales Returns and Allowances and Sales Discounts as contra revenues. Complete the following table, indicating the amount of each transaction on each item reported in Rockland's income statement prepared for internal use. Be sure to total the effects. (Enter any decreases to account balances with a minus sign.) July 12 Rockland sold merchandise to Kristina Zee at its factory store. Kristina paid for the $800 15 Sold merchandise to Shoe Express at a selling price of $8,000, with terms 3/10, n/30 purchase in cash. The goods cost Rockland $460 Rockland's cost was $4.300 Rockland's cost was $1,700 August. The returned shoes were in perfect condition and had cost Rockland $1.100 20 Collected cash due from Shoe Express 21 Sold merchandise to Fleet Foot Co at a selling price of $3,000, with terms 2/10, n/30 23 Fleet Foot Co returned $2.000 of shoes and promised to pay for the remaining goods in Transaction July 12July 15 July 20 July 21 July 23 Totals Sales Revenues 800 8,000 3,000 Sales Returns and Allowances 2,000 2,000 8,000 3.000 (2.000) Net Sales Cost of Goods Sold Gross Profit 1.700(1.100) 900) 9,800 5,360 4.440 340 3,700

Explanation / Answer

Transactions 12-Jul 15-Jul 20-Jul 21-Jul 23-Jul Totals Sales revenue 800 8000 3000 11800 Sales return and allowance 2000 2000 Sales discount 240 240 Net sales 800 8000 -240 3000 -2000 9560 Cost of Goods sold 460 4300 1700 -1100 5360 Gross profit 340 3700 -240 1300 -900 4200

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