View the step-by-step solution to:

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


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

Cost of
Goods Sold

(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

Top Answer

We need you to clarify your question for our tutors! Clarification... View the full answer

Sign up to view the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.


Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online