Question $12$ options:

Marks are indicated separately for each question in this section.$$ There are $22$ marks in total.

Toons Wholesale has the following transactions during the month of August $2021$:

Aug. $1$Purchased inventory from Bugs Inc. for $$14,000,$ FOB destination,

terms $1/10$ n$/30.$Aug. $2$The appropriate company paid $$100$ freight on the August $1$ purchase.Aug. $6$Returned $$4,000$ worth of goods to Bugs as they were the wrong size.Aug. $7$Sold half of the remaining inventory purchased from Bugs to Daffy Inc.

for $$7,500,$ FOB destination, terms $2/20$ n$/30.$Aug. $8$The appropriate company paid $$120$ freight on the August $7$ sale.Aug. $10$Paid Bugs the entire amount owed to him.Aug. $12$Purchased inventory worth $$8,000$ from Elmer Inc., FOB shipping point,

terms $3/15$ n$/45.$Aug. $13$The appropriate company paid $$150$ freight on$$ the August $12$ purchase.Aug. $17$Sold half of the inventory purchased from Elmer to Porky Ltd$.$ for $$6,000,$

FOB shipping point, terms $3/10$ n$/20.$Aug. $18$The appropriate company paid $$80$ freight on the August $17$ sale.Aug. $22$Porky returned $$1,500$ worth of the goods bought on August $17$

as you shipped the wrong colour.Aug. $25$Porky paid their outstanding balance.Aug. $30$Daffy paid their outstanding balance.Aug. $31$Paid Elmer the entire amount owed to him.

REQUIRED $-$

Use the expanded accounting equation to answer the following questions.

How would Toons Wholesale record the August $13$ transaction?

a$.$ Increase Inventory and decrease Cash

b$.$ Increase Freight Expense and decrease Cash

c$.$ Increase both Inventory and Accounts Payable

d$.$ Increase both Freight Expense and Inventory

e$.$ No entry is required.

Enter the letter that corresponds to your choice. $($A B C D E$)$

How would Toons Wholesale record the August $17$ transaction?

a$.$ Increase Cost of Goods Sold and decrease Inventory $$4,000$ each

b$.$ Increase Sales and Accounts Receivable $$6,000$ each

c$.$ Increase Sales and Accounts Receivable $$4,000$ each, and increase Cost of Goods Sold and decrease Inventory $$6,000$ each

d$.$ Increase Sales and Accounts Receivable $$6,000$ each, and increase Cost of Goods Sold and decrease Inventory $$4,000$ each

e$.$ Increase Sales and Accounts Receivable $$4,000$ each, and increase Cost of Goods Sold and decrease Inventory $$4,000$ each

Enter the letter that corresponds to your choice. $($A B C D E$)$

How would Toons Wholesale record the August $18$ transaction?

a$.$ Decrease Cash and increase Inventory

b$.$ Decrease Cash and increase Freight Expense

c$.$ Increase both Accounts Payable and Freight Expense

d$.$ Decrease both Cash and Inventory

e$.$ No entry is required.

Enter the letter that corresponds to your choice. $($A B C D E$)$

How would Toons Wholesale record the August $22$ transaction?

a$.$ Increase Inventory and decrease Cost of Goods Sold $$1,500$ each, and decrease Accounts Receivable and increase Sales Returns $$1,000$ each

b$.$ Increase Inventory and decrease Cost of Goods Sold $$1,000$ each, and decrease Accounts Receivable and increase Sales Returns $$1,500$ each

c$.$ Increase Inventory and decrease Cost of Goods Sold $$1,000$ each, and decrease Accounts Receivable and increase Sales Returns $$1,000$ each

d$.$ Increase Inventory and decrease Cost of Goods Sold $$1,000$ each

e$.$ Decrease Accounts Receivable and increase Sales Returns $$1,500$ each

Enter the letter that corresponds to your choice. $($A B C D E$)$

How would Toons Wholesale record the August $25$ transaction?

a$.$ Increase Cash and decrease Accounts Receivable only

b$.$ Increase Cash and decrease Sales Discounts $($increasing net sales$),$ and decrease Accounts Receivable

c$.$ Increase Cash and Sales Discounts $($reducing net sales$),$ and decrease Accounts Receivable

d$.$ Increase Cash and decrease both Sales and Accounts Receivable

e$.$ Increase both Cash and Sales, and decrease Accounts Receivable

Enter the letter that corresponds to your choice. $($A B C D E$)$

How much does Porky pay Toons Wholesale on August $25?$

How would Toons Wholesale record the August $30$ transaction?

a$.$ Increase Cash and decrease Accounts Receivable only

b$.$ Increase Cash and decrease both Sales and Accounts Receivable

c$.$ Increase both Cash and Sales, and decrease Accounts Receivable

d$.$ Increase Cash and increase Sales only

e$.$ Increase both Cash, Sales, and Accounts Receivable

Enter the letter that corresponds to your choice. $($A B C D E$)$

How much does Daffy pay Toons Wholesale on August $30?$

How would Toons Wholesale record the August $31$ transaction?

a$.$ Decrease Cash and Accounts Payable, and increase Inventory.

b$.$ Decrease Cash and Inventory, and increase Accounts Payable.

c$.$ Decrease Cash and increase both Inventory and Accounts Payable.

d$.$ Decrease Cash and Accounts Payable only

e$.$ Decrease Cash, Inventory, and Accounts Payable.

Enter the letter that corresponds to your choice. $($A B C D E$)$

How much does Toons Wholesale pay Elmer on August $31?$