chapter 5 from wiley - ABE5-3 Prepare the journal entries...

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ABE5-3 Prepare the journal entries to record the following transactions on Ramirez Company’s books using a perpetual inventory system. (a) On March 2 Ramirez Company sold $870,500 of merchandise to Ikerd Company, terms 4/10, n/30. The cost of the merchandise sold was $516,006. (b) On March 6 Ikerd Company returned $110,600 of the merchandise purchased on March 2. The cost of the merchandise returned was $67,050. (c) On March 12 Ramirez Company received the balance due from Ikerd Company. Date Account/Description Debit Credit Mar. 2 Accounts Receivable 870,500 Sales 870,500 (To record the sale) Cost of Goods Sold 516,006 Merchandise Inventory 516,006 (To record the cost of inventory) Mar. 6 Sales Returns and Allowances 110,600 Accounts Receivable 110,600 (To record the return) Merchandise Inventory 67,050 Cost of Goods Sold 67,050 (To record the cost of inventory) Mar. 12 Cash 729,504 Sales Discounts 30,396 Accounts Receivable 759,900 Carpenter Company provides this information for the month ended October 31, 2010: sales on credit $303,154; cash sales $155,106; sales discounts $6,155; and sales returns and allowances $23,989. Complete the sales revenues section of the income statement below, based on this information. (List multiple entries from largest to smallest amounts, e.g. 10, 5, 1.) CARPENTER COMPANY Income Statement (Partial) For the Month Ended October 31, 2010 Sales revenues Sales $ 458,260 Less: Sales returns and allowances $ 23,989 Sales discounts 6,155 30,144 Net Sales $ 428,116 Holmes Company sold goods with a total selling price of $803,750 during the year. It purchased goods for $388,010 and had beginning inventory of $74,440. A count of its ending inventory determined that goods on hand was $58,430. What was its cost of goods sold? $ 404020
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The operating cycle of a merchandising company is ordinarily ____longer_____ that of a service firm. Which of the following statements is correct ?
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