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ABE5-1 Presented below are the components in Waegelain Company's income statement. Determine the missing amounts.

ABE5-1

Presented below are the components in Waegelain Company's income statement. Determine the missing amounts.

Sales
Cost of
Goods Sold
Gross
Profit
Operating
Expenses
Net
Income

(a) $77,820 $ $37,540 $ $14,520
(b) $111,040 $76,960 $ $ $25,480
(c) $ $72,590 $83,970 $48,750 $




Hollins Company buys merchandise on account from Gordon Company. The selling price of the goods is $1,082, and the cost of the goods is $783. Both companies use perpetual inventory systems. Journalize the transaction on the books of both companies.

Hollins CompanyDescription/Account Debit Credit
CashMerchandise InventorySalesAccounts ReceivableCost of Goods SoldAccounts Payable
Accounts PayableSalesMerchandise InventoryAccounts ReceivableCost of Goods SoldCash


Gordon CompanyDescription/Account Debit Credit
Accounts PayableMerchandise InventorySalesAccounts ReceivableCashCost of Goods Sold
Accounts ReceivableSalesCost of Goods SoldMerchandise InventoryAccounts PayableCash
Merchandise InventoryAccounts PayableCashCost of Goods SoldAccounts ReceivableSales
CashMerchandise InventoryAccounts ReceivableAccounts PayableCost of Goods SoldSales
(To record the cost of merchandise.)


Prepare the journal entries to record the following transactions on Monroe Company's books using a perpetual inventory system.

(a) On March 2, Monroe Company sold $995,590 of merchandise to Churchill Company, terms 2/10, n/30. The cost of the merchandise sold was $710,060.

Description/Account Debit Credit
Accounts ReceivableSales Returns and AllowancesSales DiscountsCashSalesCost of Goods SoldMerchandise Inventory
Sales DiscountsSalesCashAccounts ReceivableCost of Goods SoldMerchandise InventorySales Returns and Allowances
CashSales Returns and AllowancesSales DiscountsCost of Goods SoldSalesAccounts ReceivableMerchandise Inventory
Sales DiscountsCost of Goods SoldSalesAccounts ReceivableSales Returns and AllowancesMerchandise InventoryCash
(To record cost of merchandise sold.)


(b) On March 6, Churchill Company returned $211,660 of the merchandise purchased on March 2 because it was defective. The cost of the returned merchandise was $105,100.

Description/Account Debit Credit
CashSales Returns and AllowancesCost of Goods SoldSales DiscountsAccounts ReceivableMerchandise InventorySales
CashCost of Goods SoldSalesMerchandise InventorySales DiscountsAccounts ReceivableSales Returns and Allowances
Merchandise InventorySales DiscountsAccounts ReceivableCost of Goods SoldSalesSales Returns and AllowancesCash
Sales DiscountsSalesMerchandise InventorySales Returns and AllowancesCost of Goods SoldCashAccounts Receivable
(To record cost of merchandise sold.)


(c) On March 12, Monroe Company received the balance due from Churchill Company. (For multiple debit/credit entries, list amounts from largest to smallest eg 10, 5, 3, 2. Round answers to 0 decimal places, e.g. 125.)

Description/Account Debit Credit
Merchandise InventoryAccounts ReceivableCost of Goods SoldSales Returns and AllowancesSales DiscountsSalesCash
Accounts ReceivableMerchandise InventoryCost of Goods SoldSales DiscountsSales Returns and AllowancesCashSales
CashSales Returns and AllowancesSalesMerchandise InventorySales DiscountsAccounts ReceivableCost of Goods Sold








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