Financial information is presented here for two companies.
Sales Returns ?
Cost of Goods Sold
Compute the missing amounts.
King – 60,000 minus 6,000 = 54,000
54,000 minus 24,000 = 30,000 minus 8,000 = 22,000
Queen – 67,000 minus 5,000 = 62,000 minus 24,000 = 38,000 – 20,000 = 18,000
Name 3 operating expenses
Depreciation Expense, Selling,General and Administrative Expenses, Advertising expenses, repairs and
maintenance expenses, salaries expenses, utility expenses, etc.
The following transactions are for Kale Company.
On December 3 Kale Company sold
$450,000 of merchandise to Thomson Co., terms 1/10, n/10. The cost of
the merchandise sold was $320,000.
On December 8 Thomson Co. was granted an allowance of $20,000 for merchandise purchased on
(Kale gave Thomson an Allowance – sales return and allowance)
On December 13 Kale Company received the balance due
from Thomson Co.
Prepare the journal entries to record these transactions on the books of Kale Company. Kale uses a perpetual
DR Accounts Receivable $450,000
DR Cost of Goods Sold
DR Sales Returns and Allowances
(Note – allowance – take an amount off, for a quality issue, etc.
No returned goods –therefore no Cost of Goods Sold/Inventory
Accounts Receivable now has a balance of $430,000 (450-20).
Thompson paid the amount due within the discount period –