4 include in inventory under invoice terms title

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4.Include in inventory. Under invoice terms, title passed whengoods were shipped.5.Do not include. Goods received on consignment remain theproperty of the consignor.EXERCISE 8-4 (10–15 minutes)1.Raw Materials Inventory...............................8,100Accounts Payable................................8,1002.Raw Materials Inventory...............................28,000Accounts Payable................................28,0003.No adjustment necessary.4.Accounts Payable..........................................7,500Raw Materials Inventory......................7,5005.Raw Materials Inventory...............................19,800Accounts Payable................................19,800
EXERCISE 8-5 (15–20 minutes)(a)Inventory December 31, 2014 (unadjusted)$234,890Transaction 213,420Transaction 3-0-Transaction 4-0-Transaction 58,540Transaction 6(10,438)Transaction 7(10,520)Transaction 81,500Inventory December 31, 2014 (adjusted)$237,392(b)Transaction 3Sales Revenue..............................................12,800Accounts Receivable..........................12,800(To reverse sale entry in 2014)Transaction 4Purchases (Inventory)..................................15,630Accounts Payable...............................15,630(To record purchase of merchandise in 2014)Transaction 8Sales Returns and Allowances...................2,600Accounts Receivable..........................2,600
EXERCISE 8-7 (10–15 minutes)(a)May 10Purchases........................................14,700Accounts Payable..................14,700($15,000 X .98)May 11Purchases........................................13,068Accounts Payable..................13,068($13,200 X .99)May 19Accounts Payable............................14,700Cash.........................................14,700May 24Purchases........................................11,270Accounts Payable($11,500 X .98).......................11,270
EXERCISE 8-7 (Continued)(b)May 31Purchase Discounts Lost..............................132Accounts Payable($13,200 X .01)....................................132(Discount lost on purchase ofMay 11, $13,200, terms 1/15, n/30)EXERCISE 8-8 (20–25 minutes)(a)Feb. 1Inventory [$10,800 – ($10,800 X 10%)].....9,720Accounts Payable............................9,720Feb. 4Accounts Payable [$2,500 – ($2,500 X 10%)].......................................2,250Inventory...........................................2,250Feb. 13Accounts Payable ($9,720 – $2,250)........7,470Inventory (3% X $7,470)...................224.10Cash...................................................7,245.90(b)Feb. 1Purchases [$10,800 – ($10,800 X 10%)]...9,720Accounts Payable............................9,720Feb. 4Accounts Payable [$2,500 – ($2,500 X10%)]........................................................2,250Purchase Returns and Allowances. .2,250Feb. 13Accounts Payable ($9,720 – $2,250)........7,470Purchase Discounts (3% X $7,470)...224.10Cash...................................................7,245.90(c)Purchase price (list)$10,800.00Less: Trade discount (10% X $10,800)1,080.00
Price on which cash discount based9,720.00Less: Cash discount (3% X $9,720)291.60Net price$ 9,428.40
EXERCISE 8-14 (20–25 minutes)(a)(1)LIFO600 @ $6.00 =$3,600100 @ $6.08 =608$4,208(2)Average costTotal cost=$33,655*= $6.35 average cost per unitTotal units5,300700 @ $6.35 = $4,445*UnitsPriceTotal Cost600@$6.00=$3,6001,500@$6.08=9,120800@$6.40=5,1201,200@$6.50=7,800700@$6.60=4,620500@$6.79=3,3955,300$33,655

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