Rockland Shoe Company records Sales Returns and Allowances and Sales Discounts as contra-revenues. Complete the following table, indicating the amount and direction of effect (1 for increase, 2 for decrease, and NE for no effect) of each transaction on each item reported in Rock-land’s income statement prepared for internal use. Be sure to total the effects.
July 12 Rockland sold merchandise to Kristina Zee at its factory store. Kristina paid for the $ 300 purchase in cash. The goods cost Rockland $ 160.
15 Sold merchandise to Shoe Express at a selling price of $ 5,000, with terms 3/10, n/30. Rockland’s cost was $ 3,000.
20 Collected cash due from Shoe Express.
21 Sold merchandise to Fleet Foot Co. at a selling price of $ 2,000, with terms 2/10, n/30. Rockland’s cost was $ 1,200.
23 Fleet Foot Co. returned $ 1,000 of shoes and promised to pay for the remaining goods in August. The returned shoes were in perfect condition and had cost Rockland $ 600.

  • CreatedNovember 02, 2015
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