ABC Co$.$ began operations on January $1.$ Please prepare journal entries, where

appropriate, for the following transactions during January.

Jan $2$ Purchased $$8,000$ merchandise, $\frac{2}{10},\frac{n}{30}.$ FOB Shipping Point

Jan $4$ The responsible party paid the freight bill of $$75$

Jan $8$ Returned $$600$ of merchandise purchased on Jan $2$ receiving credit memo

Jan $12$ Paid amount owed for January $2$

Jan $14$ Sold $$4,000$ of merchandise, $\frac{1}{10},\frac{n}{30},$ FOB Destination. Cost of the merchandise

was $$1,500$

Jan $16$ The responsible party paid the freight bill of $$50$

Jan $24$ Collected amount owed from January $14$

Jan $29$ Sold $$2,000$ of merchandise, $\frac{n}{30},$ FOB Shipping Point. Cost of the merchandise was

$$750$

Jan $31$ The responsible party paid the freight bill of $$50$

What is the balance in the Inventory account at January $31?$

Prepare a Multi$-$step Income Statement for the month of January using the above

information and the additional information below:

Sales Salaries $$800$

Property Taxes $$300$

Interest Expense $$200$

Insurance $$400$

Advertising $$700$Practice Quiz

Retail Transactions

ABC Co$.$ began operations on January $1.$ Please prepare journal entries, where

appropriate, for the following transactions during January.

Jan $2$ Purchased $$8,000$ merchandise, $2/10,$ n$/30.$ FOB Shipping Point

Jan $4$ The responsible party paid the freight bill of $$75$

Jan $8$ Returned $$600$ of merchandise purchased on Jan $2$ receiving credit memo

Jan $12$ Paid amount owed for January $2$

Jan $14$ Sold $$4,000$ of merchandise, $\frac{1}{10},\frac{n}{30},$ FOB Destination. Cost of the merchandise

was $$1,500$

Jan $16$ The responsible party paid the freight bill of $$50$

Jan $24$ Collected amount owed from January $14$

Jan $29$ Sold $$2,000$ of merchandise, n$/30,$ FOB Shipping Point. Cost of the merchandise was

$$750$

Jan $31$ The responsible party paid the freight bill of $$50$

What is the balance in the Inventory account at January $31?$

Prepare a Multi$-$step Income Statement for the month of January using the above

information and the additional information below:

Sales Salaries $$800$

Property Taxes $$300$

Interest Expense $$200$

Insurance $,$$$400,$ Advertising $$700$

What is the advantage of the Multi$-$step Income Statement format? What additional

visibility does this income statement provide to us in terms of different levels of

profitability and why is each important in decision making? Please address each level.

Why do companies offer payment terms? Why do they offer discounts for early

payment?

Any evidence of the matching principle in this chapter?