The amount recorded for merchandise inventory includes all of the following except:
a. Purchase discounts.
b. Returns and allowances.
c. Freight costs paid by the buyer.
d. Freight costs paid by the seller.
e. Trade discounts.
The amount recorded for merchandise inventory includes all of the following except:
a. Purchase discounts.
b. Returns and allowances.
c. Freight costs paid by the buyer.
d. Freight costs paid by the seller.
e. Trade discounts.
Related questions
| Nov. | 3 | Instructions: Journalize the transactions below (credit and debit) Purchased merchandise on account from Moonlight Co., list price $90,000, trade discount Discounts from the list prices in published catalogs or special discounts offered to certain classes of buyers. 25%, terms FOB destinationFreight terms in which the seller pays the transportation costs from the shipping point to the final destination. , 2/10, n/30. |
| 4 | Sold merchandise for cash, $36,900. The cost of the goods sold The cost that is reported as an expense when merchandise is sold. was $20,480. | |
| 5 | Purchased merchandise on account from Papoose Creek Co., $50,700, terms FOB shipping point Freight terms in which the buyer pays the transportation costs from the shipping point to the final destination. , 2/10, n/30, with prepaid freight of $750 added to the invoiceThe bill that the seller sends to the buyer. . | |
| 6 | Returned $12,750 ($17,000 list price less trade discount of 25%) of merchandise purchased on November 3 from Moonlight Co. | |
| 8 | Sold merchandise on account to Quinn Co., $14,550 with terms n/15. The cost of the goods sold was $9,510. | |
| 13 | Paid Moonlight Co. on account for purchase of November 3, less return of November 6. | |
| 14 | Sold merchandise on VISA, $239,110. The cost of the goods sold was $137,270. | |
| 15 | Paid Papoose Creek Co. on account for purchase of November 5. | |
| 23 | Received cash on account from sale of November 8 to Quinn Co. | |
| 24 | Sold merchandise on account to Rabel Co., $57,100, terms 1/10, n/30. The cost of the goods sold was $32,270. | |
| 28 | Paid VISA service fee of $3,700. | |
| 30 | Paid Quinn Co. a cash refund of $5,960 for returned merchandise from sale of November 8. The cost of the returned merchandise was $3,290. |
Question 10 (15 points)
The following is a partial Adjusted Trial Balance for Alpha Company for the month:
| Alpha Company | ||
| Adjusted Trial Balance (partial) | ||
| January 31, 2016 | ||
| Accounts | Debit | Credit |
| Inventory | $2,750 | |
| Sales | $11,500 | |
| Sales Discounts | 200 | |
| Sales Returns & Allowances | 1,200 | |
| Purchases | 4,000 | |
| Purchases Discounts | 150 | |
| Purchase Returns & Allowances | 450 | |
| Freight In | 50 | |
| Advertising Expense | 150 | |
| Depreciation Expense | 130 | |
| Freight Out | 70 | |
| Income Tax Expense | 500 | |
| Salaries Expense | 550 | |
| Utilities Expense | 100 | |
Additionally, Inventory for December 31, 2015 was $2,600. Prepare a multiple-step income statement.
What amount should Alpha Company report on a Multi-Step Income Statement for the following items:
1. Net Sales
2. Cost of Goods Available for Sales
3. Gross Profit
4. General & Administrative Expenses
5. Income before Taxes
