The following transactions are for Unique Artworks Ltd. 1. On 7 December Unique Artworks Ltd sold...

 

Transcribed Image Text:

The following transactions are for Unique Artworks Ltd. 1. On 7 December Unique Artworks Ltd sold $792 000 of inventory to Cambridge Collectables Ltd, terms 2/7, n/30. The cost of the inventory sold was $528 000. 2. On 8 December Cambridge Collectables Ltd was granted an allowance of $33000 for inventory purchased on 7 December. 3. On 13 December Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd. Required (a) Prepare the journal entries to record these transactions in the records of Unique Artworks Ltd. (b) Assume that Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd on 2 January of the following year instead of 13 December. Prepare the journal entry to record the receipt of payment on 2 January. (c) What are the advantages and disadvantages associated with granting a discount for early payment? The following transactions are for Unique Artworks Ltd. 1. On 7 December Unique Artworks Ltd sold $792 000 of inventory to Cambridge Collectables Ltd, terms 2/7, n/30. The cost of the inventory sold was $528 000. 2. On 8 December Cambridge Collectables Ltd was granted an allowance of $33000 for inventory purchased on 7 December. 3. On 13 December Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd. Required (a) Prepare the journal entries to record these transactions in the records of Unique Artworks Ltd. (b) Assume that Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd on 2 January of the following year instead of 13 December. Prepare the journal entry to record the receipt of payment on 2 January. (c) What are the advantages and disadvantages associated with granting a discount for early payment? The following transactions are for Unique Artworks Ltd. 1. On 7 December Unique Artworks Ltd sold $792 000 of inventory to Cambridge Collectables Ltd, terms 2/7, n/30. The cost of the inventory sold was $528 000. 2. On 8 December Cambridge Collectables Ltd was granted an allowance of $33000 for inventory purchased on 7 December. 3. On 13 December Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd. Required (a) Prepare the journal entries to record these transactions in the records of Unique Artworks Ltd. (b) Assume that Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd on 2 January of the following year instead of 13 December. Prepare the journal entry to record the receipt of payment on 2 January. (c) What are the advantages and disadvantages associated with granting a discount for early payment? The following transactions are for Unique Artworks Ltd. 1. On 7 December Unique Artworks Ltd sold $792 000 of inventory to Cambridge Collectables Ltd, terms 2/7, n/30. The cost of the inventory sold was $528 000. 2. On 8 December Cambridge Collectables Ltd was granted an allowance of $33000 for inventory purchased on 7 December. 3. On 13 December Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd. Required (a) Prepare the journal entries to record these transactions in the records of Unique Artworks Ltd. (b) Assume that Unique Artworks Ltd received the balance due from Cambridge Collectables Ltd on 2 January of the following year instead of 13 December. Prepare the journal entry to record the receipt of payment on 2 January. (c) What are the advantages and disadvantages associated with granting a discount for early payment?

Answer rating: 100% (QA)

Journal entry date explanation debit credit A 1 accounts receivables 792000 sales 792000 2 cost ... View the full answer