Any insight would be great! Any insight would be great! CHAPTER 7 Problem 1 The

Question

Any insight would be great!
Any insight would be great! CHAPTER 7 Problem 1 The Martine Company uses a sales journal, a cash receipts journal to record transactions with its customers. The costs of all merchandise sold was 70% of the sales price. Transactions: July 1 July 2 July 5 July 8 July 10 Owner invested $10,000 to start Martime Company. Sold merchandise for $12,000 cash. Received a check for $800 from R. Hyatt in payment of his account. Sold merchandise for $900 cash. Received a check in payment of Sales Invoice No. 100 which was for $500 from B. Rice minus the 2% discount. July 18 Borrowed $25,000 cash from United Bank signing a 6-month, 10% note.

Explanation / Answer

(2)

Date Ref Debit Credit 01-Jul 101 Cash 10000 300 to Owners's Capital 10000 02-Jul 101 Cash 12000 401 to Cash Sales 12000 02-Jul 501 COGS 8400 140 to Inventory 8400 05-Jul 101 Cash 800 120 to Account Receivable 800 08-Jul 101 Cash 900 401 to Cash Sales 900 08-Jul 501 COGS 630 140 to Inventory 630 10-Jul 101 Cash 490 402 Sales Discount 10 120 to Account Receivable 500 18-Jul 101 Cash 25000 205 to Note Payable 25000

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