1. Use either the gross method or net method to record the following transactions, 10% extra credit if you use both methods.

10/1 Purchased $5,000 of tables on account the terms of payment are 1/15n30

10/5 Returned $1,000 of tables to the supplier

10/14 Paid $3,000 of the balance due on the account

10/30 Paid the remaining balance due on the account

2.

Determine the material price and usage variances for the month of October

Direct material 3.0 pounds per unit at $5.00 per pound

Units produced 6,000

Units sold 5,500

Material purchased 20,000 pounds $102,000

Material used 17,500 pounds