Sales Revenue Sales Discount Sales Return&Allowance; Salaries Expenses Cost of G

Question

Sales Revenue Sales Discount Sales Return&Allowance; Salaries Expenses Cost of Goods Sold Rent & Insurance Expenses Gain on Sales of Land Interest Expense $280,000 18,000 12,000 20,000 40,000 10,000 35,000 5,000 20,000 4,000 6,000 25,000 15,000 Purchase Purchase Discount Purchase Return&Allowance; Beginning Inventory Ending Inventory 1. What are the contra accounts to sales? 2. What are the primary categories of expenses in a Merchandise Company? 3. What does F.O.B mean? Briefly explain F.O.B shipping point. Briefly explain F.O.B destination. Inventory in a Merchandise Company is considered an intangible asset? True or False (if False why) 4. 5. 6. 7. What would be the odjustment jounali an for the following ABC perpetual inventory is $25,510 while the physical count shows $28,810? Under the perpetual method of accounting, what would be the journal(s) typical to record a sales transaction? 8. 9. Why would companies offer a discount? 10. Under Discount terminology what does 1/10, n/30 means?

Explanation / Answer

1.sales returns,sales allowance and sale discounts

2. cost of goods sold and operating expenses

3.ree on board/ freight on board

4. seller places the goods free on board to the carries, and the buyer pays the freight costs

5. the seller places the goods free on board to the buyer's place of business, and the seller pays the freight

6.False

7.Inventory Dr 3300 COGS Cr 3300

8.Accounts payable Dr     Sale Cr

COGS dr     Inventory Cr

9.Getting earlier repayment

10. Allowed credit period is 30 days and 1% discount given if paid in 10 days.

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