Paid Quinn Co. a cash refund of $6,000 for returned merchandise from sale of Nov
ID: 2748556 • Letter: P
Question
Paid Quinn Co. a cash refund of $6,000 for returned merchandise from sale of November 8. The cost of the returned merchandise was $3,300.
REQUIRED
Prepare a partial income statement -- Sales (Gross sales, sales returns, sales discount), (cost of goods sold, freight in and purchase discounts), gross profit.
Date Account Name Credit Debit 11/3 Merchandise Inventory $63,750 Accounts Payable $63,750 11/4 Cash $37,680 Sales $37,680 11/4 Cost of Merchandise Sold $22,600 Merchandise Inventory $22,600 11/5 Merchandise Inventory $48,310 Accounts Payable-Papoose Creek Co $48,310 11/6 Accounts Payable-Moonlight Co $13,500 Merchandise Inventory $13,500 11/8 Accounts Receivable $15,600 Sales $15,600 11/8 Cost of Merchandise Sold $9,400 Merchandise Inventory $9,400 11/13 Accounts Payable-Moonlight Co $50,250 Cash $49,245 Merchandise Inventory $1,005 11/14 Cash $236,000 Sales $236,000 11/14 Cost of Merchandise Sold $140,000 Merchandise Inventory $140,000 11/15 Accounts Payable-Papoose Creek Co $48,310 Cash $47,360 Merchandise Inventory $950 11/23 Cash $15,600 Accounts Receivable-Quinn Co $15,600 11/24 Accounts Receivable-Rabel Co $56,900 Sales $56,900 11/24 Cost of Merchandise Sold $34,000 Merchandise Inventory $34,000 11/28 Credit Card Expense $3,540 Cash $3,540 11/30 Sales Returns and Allowances $6,000 Accounts Receivable-Quinn Co $6,000 11/30 Merchandise Inventory $3,300 Cost of Merchandise Sold $3,300Explanation / Answer
Income statement Sl No Particulars Amounts in dollars 1 Sales (Note 1) 346180 Less : 2 Sale returns ( Note 2 ) 6000 Net sales Sales - Sales returns 340180 3 Less costs : 4 Cost of goods sold ( Note 3) 202700 5 Freight in ( Note 4) 810 6 Purchases discount ( Note 5) 16750 Total costs 220260 220260 Gross profit ( Net sales - Total costs ) 119920 Calculation of sales and sale returns Amounts in dollars Date Particulars Gross sales (Note 1) Sales returns (Note 2) Sales discount Net sales 4 Sale 37680 37680 8 Quinn 15600 15600 14 VISA 236000 236000 24 Rabel 56900 56900 30 Sales returns 6000 -6000 Total 346180 6000 340180 Calculation of cost of goods sold, Freight in Amounts in dollars Date Particulars Cost of goods sold ( Note 3) Freight in (Note 4) 4 Sale 22600 8 Quinn 9400 810 14 VISA 140000 24 Rabel 34000 30 Sales returns -3300 Total 202700 810 Calculation of P:urchses and purchase discount Amounts in dollars Date Purchases Gross Discount ( Note 5 ) Net 3 Moonlight 85000 21250 63750 5 Papoose 47500 47500 6 Moonlight -18000 -4500 -13500 Total 114500 16750 97750
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