Happy Feet Ltd. is the sole distributor of a popular brand of running shoes to local...
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Happy Feet Ltd. is the sole distributor of a popular brand of running shoes to local sporting stores in Southern Ontario. Happy Feet does not sell any products other than the single type of running shoes. On January 1, 2021, the company had the following opening account balances: Date Jan 7 Retained earnings Note: All accounts have normal balances. During the three months (quarter) ended March 31, 2021, the company had the following transactions: Jan 11 Jan 15 Jan 22 Feb 18 Feb 24 Mar 5 Cash Accounts receivable (All from Store A) Allowance for doubtful accounts Inventory (500 pairs of shoes) Mar 15 Mar 30 50,000 38,000 3,500 30,000 105,600 Transaction Sold 300 pairs of shoes to Store B on credit. Purchased 200 pairs of shoes for cash. Received payment from Store B in settlement of 50 percent of the accounts receivable from Jan. 11. Sold 100 pairs of shoes to Store C on credit. Received payment from Store A in settlement of accounts receivable. Accepted a return of 50 pairs of shoes from Store C and credit was given to the customer. The remaining balance of the amount owed by Store A was written off as uncollectible. Purchased 350 pairs of shoes for cash. Sold 300 pairs of shoes to store D on credit. Amount 36,000 12,000 ? 13,000 35,000 6,500 ? 24,500 51,000 Additional Information: a. Happy Feet provides the terms 2/10, net 30 for all its credit sales. b. Happy Feet uses the perpetual inventory method and the average cost method. c. Happy Feet Ltd. provides for uncollectible accounts as follows: Not yet due 1-30 days overdue 31-60 days overdue >60 days overdue d. There are no other transactions, revenues of expenses. Required: 4% 7% 10% 15% 1. Prepare all journal entries necessary to account for the above transactions and any necessary quarter end adjusting entries. Ignore income and sales taxes. 2. Prepare a statement of earnings down to the gross profit line for the three months ending March 31, 2021. Happy Feet Ltd. is the sole distributor of a popular brand of running shoes to local sporting stores in Southern Ontario. Happy Feet does not sell any products other than the single type of running shoes. On January 1, 2021, the company had the following opening account balances: Date Jan 7 Retained earnings Note: All accounts have normal balances. During the three months (quarter) ended March 31, 2021, the company had the following transactions: Jan 11 Jan 15 Jan 22 Feb 18 Feb 24 Mar 5 Cash Accounts receivable (All from Store A) Allowance for doubtful accounts Inventory (500 pairs of shoes) Mar 15 Mar 30 50,000 38,000 3,500 30,000 105,600 Transaction Sold 300 pairs of shoes to Store B on credit. Purchased 200 pairs of shoes for cash. Received payment from Store B in settlement of 50 percent of the accounts receivable from Jan. 11. Sold 100 pairs of shoes to Store C on credit. Received payment from Store A in settlement of accounts receivable. Accepted a return of 50 pairs of shoes from Store C and credit was given to the customer. The remaining balance of the amount owed by Store A was written off as uncollectible. Purchased 350 pairs of shoes for cash. Sold 300 pairs of shoes to store D on credit. Amount 36,000 12,000 ? 13,000 35,000 6,500 ? 24,500 51,000 Additional Information: a. Happy Feet provides the terms 2/10, net 30 for all its credit sales. b. Happy Feet uses the perpetual inventory method and the average cost method. c. Happy Feet Ltd. provides for uncollectible accounts as follows: Not yet due 1-30 days overdue 31-60 days overdue >60 days overdue d. There are no other transactions, revenues of expenses. Required: 4% 7% 10% 15% 1. Prepare all journal entries necessary to account for the above transactions and any necessary quarter end adjusting entries. Ignore income and sales taxes. 2. Prepare a statement of earnings down to the gross profit line for the three months ending March 31, 2021.
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Answer rating: 100% (QA)
1 Journal Entries from January 1st to March 31st Date Particulars Amount Amount Jan07 Accounts Receivable Store B Ac Dr 3600000 To Sales Ac 3600000 be... View the full answer
Related Book For
Financial and Managerial Accounting
ISBN: 978-1285866307
13th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac
Posted Date:
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