• Williams distributing company is a merchandising company Williams uses the perpetual inventory system. Record each of the following transactions related to the companies purchasing and selling of the merchandise:

- purchased merchandise on account for.......................$6000

- paid $200 cash for free on March 1 purchase

-returned merchandise costing .....................$300 ( part of the $6000 purchase)

- paid for merchandise purchased on March 1
- sold merchandise on account costing .....................$8000 for $10,000

- excepted returned and undamaged merchandise from a customer costing $20 that had been sold on account for $500 ( part of the $10,000 sale)

- received payment from customer for merchandise sold on March 12

Prepare journal entries for above transactions

2.The following account balance in alphabetical order general ledger of Morgan waterproof and service of January 31. The firm began business on January 1 all accounts have a normal balances.

Accounting payable .....................$2600

Notes Payable .....................$6000

Accounts recievable .....................$21,000

Advertising Expense .....................$420

Cash .....................$10,400

Common Stock .....................$29,740

Dividends .....................$3,000

Interest Expenses .....................$50

Rent Expense .....................$1,700

Salaries expenses $8,000

Service fees earned .....................$25,760

Supplies ........................................$8,960

Supplies Expenses .....................$10,250

Utilities Expenses ........................$320

Prepare the closing entries

3. In periods of rising prices, LIFO will produce(multiple choice):

(A) higher net income than FIFO

(B)the same net income as FIFO

(C)lower net income than FIFO

(D)higher net income than average-cost

-The sales accounts that normally have a debit balance are:

A)Sales Discount

(B)Sales Returns and Allowances

(C) both a and b

(D)neither a or b

-A credit sale of $750 is made on June 13.it would turn of $50 is granted on June 16. The amount received as payment in full on June 23 is:

A)$700

(B)$686

(C)$685

(D)$650

-Which of the following accounts will normally a pair in the ledger of the merchandising company that uses a perpetual inventory system?

A)purchases

(B)freight in

(C)cost of good sold

(D)purchase discounts

-To record the sale of goods for cash in a perpetual inventory system:

A)only one journal entry is necessary to record cost of goods sold and reduction of inventory

(B)only one journal entry is necessary to record the receipt of cash and the sales revenue

(C) two journal entries are necessary went to record the receipt of cash in sales revenue and want to record the cost of good sold and reduction of inventory

(D)to journal entries are necessary want to record receipt of cash and reduction of inventory and want to record the cost of good sold and sales revenue

Answer rating: 100% (QA)

1 a Purchased Merchandise on Account Debit Merchandise Inventory 6000 Credit Accounts Payable 6000 b Paid 200 Cash for Freight Debit Cash 200 Credit F... View the full answer