During the current period. the following transactions were completed by Alfurat Corporation. The company uses a...

 

 

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During the current period. the following transactions were completed by Alfurat Corporation. The company uses a periodic inventory system. (1) Sales on account totaled S 18800. (2) Building and tract of land were acquired at a cost of'S 300000. The value of the land was estimated at $90000. One-forth of the purchase price was paid in cash and an 8°. mortgage payable was signed for the balance. (3) Merchandise costing S 24000 was purchased, subject to a cash discount 2%. (4) Freight charges related to merchandise acquisitions of $ 105 Were paid. (5) Accounts receivable of'S 525were written off. Alfurat corporation employs an allowance for uncollectible accounts and makes provision for uncollectible accounts at the end of each period. (6) The invoice for the purchase in item (3) was paid within the discount period. (7) Collection on customers, accounts totaled S 5606 (8) Equipment which originally cost S 14500 and on which accumulated depreciation amounted to S 10400 was sold for $3000 cash. (9) A cash dividend of 28 cents per share On 100000 shares was declared and paid. (10) 22000 shares of S bar value common stock were sold for S 18 per share. (11) Defective merchandise. which was purchased on account for S 1800 was returned. (12) A customer's check for S 125 received and deposited by Alfurat Corporation was returned by the bank marked "NSF Required: Record the above transactions in journal form. Listed below are the account balances from the ledger of Milton company at October31. except for retained earnings, which is the October 1 balance. There are no assets or liabilities other than those listed. The dividends account represents the amount declared and paid during October. Accounts payable Accounts receivable Accumulated depreciation Capital stock: $ 10 par value Cash Dividends Inventory Plant and equipment Retained earnings. October 1 S 20000 16000 32000 110000 21000 4000 32000 110000 16000 Required: 1. Compute the net income of Milton Company for October by preparing a balance sheet at October31 which includes details showing the beginning balance of retained earnings increases and decreases and the ending balance. 2. what was the amount of total sales for October, assuming that the accounts receivable amounted to S18000 on October 1, and that S 80000 was received in collections from astomers and thom cash sales during October? Show computations. 3. Determine the cost of goods sold for October, assuming that inventory of October I was S 29000 and that October purchases of merchandise totaled S 55000. What was the total of all other expenses for the month? Show computations. 4. Determine the total cash outlay for merchandise during October. assuming that the beginning balance of accounts payable was S 19000 and that October purchases of merchandise all on credit ) amounted to S 55000. Show computations The Babil Company maintains a checking account at the ratidain bank The bank provides a bank statement along with canceled checks on the Last day of each month. The July 2009 bank statement included the following information : Balance. July 1. 2009 Deposits Checks processed NSF checks Service charges Monthly loan payment deducted directly by bank From account (includes 320 interest S 55678 179500 (192610) (1200) (30) (3320) Balance. July 2009 S 38018 The company's general ledger account had a balance of S 38918 at the end of July. Deposits outstanding totaled S 6300 and all checks written by the company were processed by the bank except for those totaling $8420. In addition. a S 2000 July deposit from a credit customer was recorded as a S 200 debit to cash and credit to accounts receivable, and a check correctly recorded by the company as a S 30 disbursement was incorrectly processed by the bank as a S 300 disbursement. Required: 1. Prepare a bank reconciliation for the month of July. 2. Prepare the necessary journal entries at the end of July to adjust the general ledger cash account. During the current period. the following transactions were completed by Alfurat Corporation. The company uses a periodic inventory system. (1) Sales on account totaled S 18800. (2) Building and tract of land were acquired at a cost of'S 300000. The value of the land was estimated at $90000. One-forth of the purchase price was paid in cash and an 8°. mortgage payable was signed for the balance. (3) Merchandise costing S 24000 was purchased, subject to a cash discount 2%. (4) Freight charges related to merchandise acquisitions of $ 105 Were paid. (5) Accounts receivable of'S 525were written off. Alfurat corporation employs an allowance for uncollectible accounts and makes provision for uncollectible accounts at the end of each period. (6) The invoice for the purchase in item (3) was paid within the discount period. (7) Collection on customers, accounts totaled S 5606 (8) Equipment which originally cost S 14500 and on which accumulated depreciation amounted to S 10400 was sold for $3000 cash. (9) A cash dividend of 28 cents per share On 100000 shares was declared and paid. (10) 22000 shares of S bar value common stock were sold for S 18 per share. (11) Defective merchandise. which was purchased on account for S 1800 was returned. (12) A customer's check for S 125 received and deposited by Alfurat Corporation was returned by the bank marked "NSF Required: Record the above transactions in journal form. Listed below are the account balances from the ledger of Milton company at October31. except for retained earnings, which is the October 1 balance. There are no assets or liabilities other than those listed. The dividends account represents the amount declared and paid during October. Accounts payable Accounts receivable Accumulated depreciation Capital stock: $ 10 par value Cash Dividends Inventory Plant and equipment Retained earnings. October 1 S 20000 16000 32000 110000 21000 4000 32000 110000 16000 Required: 1. Compute the net income of Milton Company for October by preparing a balance sheet at October31 which includes details showing the beginning balance of retained earnings increases and decreases and the ending balance. 2. what was the amount of total sales for October, assuming that the accounts receivable amounted to S18000 on October 1, and that S 80000 was received in collections from astomers and thom cash sales during October? Show computations. 3. Determine the cost of goods sold for October, assuming that inventory of October I was S 29000 and that October purchases of merchandise totaled S 55000. What was the total of all other expenses for the month? Show computations. 4. Determine the total cash outlay for merchandise during October. assuming that the beginning balance of accounts payable was S 19000 and that October purchases of merchandise all on credit ) amounted to S 55000. Show computations The Babil Company maintains a checking account at the ratidain bank The bank provides a bank statement along with canceled checks on the Last day of each month. The July 2009 bank statement included the following information : Balance. July 1. 2009 Deposits Checks processed NSF checks Service charges Monthly loan payment deducted directly by bank From account (includes 320 interest S 55678 179500 (192610) (1200) (30) (3320) Balance. July 2009 S 38018 The company's general ledger account had a balance of S 38918 at the end of July. Deposits outstanding totaled S 6300 and all checks written by the company were processed by the bank except for those totaling $8420. In addition. a S 2000 July deposit from a credit customer was recorded as a S 200 debit to cash and credit to accounts receivable, and a check correctly recorded by the company as a S 30 disbursement was incorrectly processed by the bank as a S 300 disbursement. Required: 1. Prepare a bank reconciliation for the month of July. 2. Prepare the necessary journal entries at the end of July to adjust the general ledger cash account.

Answer rating: 100% (QA)

SOLUTION Part 1 Net Income for October Beginning Retained Earnings 16000 Add Net Income Less Dividen... View the full answer