AM Enterprise Trial Balance as at 31 December 2019 Debit Credit RM RM Cash 17,500 Account Receivable
Question:
AM Enterprise Trial Balance as at 31 December 2019
Debit Credit
RM RM
Cash 17,500
Account Receivable 6,200
Merchandise Inventory 8,000
Office Equipment 24,000
Accumulated Depreciation - Office Equipment 7,200
Account Payable 6,500
Capital 42,000
55,700 55,700
The transactions occurred during the month of January 2020 are as follows:
1. Purchased merchandise on account from LY Sdn. Bhd., listed price of RM24,000, trade discount 15%, with credit term of 2/10, n/30, FOB destination.
2. Sold merchandise to NZ Enterprise for RM19,600 under credit terms of 3/15, n/30, FOB shipping point. The cost of merchandise sold was RM8,800.
3. Returned faulty merchandise to LY Sdn. Bhd. of RM6,000.
4. Sold merchandise to ED Enterprise for cash RM10,000. The cost of merchandise sold was RM5,400.
5. Paid LY Sdn. Bhd. the amount due within the discount period.
6. Paid salaries expense of RM3,600, rent expense of RM2,800, and miscellaneous expense of RM3,200.
7. Office equipment is depreciated at RM2,400 per year.
REQUIRED:
(a) Prepare journal entries to record the above transactions and adjustment.
(b) Prepare Statement of Profit or Loss and Other Comprehensive Income (multiple step) for the month ended 31 January 2020 and Statement of Financial Position as at 31 January 2020.
(c) Explain the difference between the nature of AM Enterprise as a merchandise business and EDC Hotels and Resorts as a service business.
Expert Answer:
a Journal entries Particular Accounts Debitin Creditin Purchases Account 20400 to LY Sdn Bhd Account ... View the full answer
