Kylie Henderson owns Hendersons Home Improvement Shop in London. (In your working papers, balances as of May
Question:
Kylie Henderson owns Henderson’s Home Improvement Shop in London. (In your working papers, balances as of May 1 are provided for the accounts receivable and general ledger accounts.) The following transactions occurred in May:
2018 May
1 Kylie Henderson invested an additional $12,000 in the home improvement store.
4 Sold $900 worth of merchandise on account to B. Dale, sales invoice No. 160, terms 1/10, n/30. Cost of inventory was $675.
4 Sold $500 worth of merchandise on account to Ron Lester, sales invoice No. 161, terms 1/10, n/30. Cost of inventory was $375.
8 Sold $200 worth of merchandise on account to Jim Zon, sales invoice No. 162, terms 1/10, n/30. Cost of inventory was $150.
11 Received cash from B. Dale in payment of May 4 transaction, sales invoice No. 160, less discount.
21 Sold $3,000 worth of merchandise on account to Pam Pry, sales invoice No. 163, terms 1/10, n/30. Cost of inventory was $2,250.
22 Received cash payment from Ron Lester in payment of May 4 transaction, sales invoice No. 161.
22 Collected cash sales, $3,000. Cost of inventory was $2,250.
25 Issued credit memorandum No. 31 to Pam Pry for $2,000 worth of merchandise returned from May 21 sales on account. Cost of inventory was $1,500.
25 Collected cash sales, $7,000. Cost of inventory was $5,250. 28 Received cash from Pam Pry in payment of May 21 sales invoice No. 163. (Don’t forget about the credit memo and discount.)
28 Sold home improvement rack equipment for $300 cash. (Beware.)
29 Sold merchandise, priced at $4,000, on account to Ron Lester, sales invoice No. 164, terms 1/10, n/30. Cost of inventory is $3,000
31 Issued credit memorandum No. 32 to Ron Lester for $700 worth of defects from May 29 transaction, sales invoice No. 164. The merchandise was not returned to inventory
Required
a. Journalize the transactions.
b. Record in the accounts receivable subsidiary ledger.
c. Prepare a schedule of accounts receivable as of May 31.
Accounts ReceivableAccounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
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College Accounting A Practical Approach
ISBN: 978-0134166698
13th Canadian edition
Authors: Jeffrey Slater, Debra Good