Question 1

 Credit Sales                                        Sales Returns Date of

 Date       Amount    Terms                  Date         Amount         Collection

1-DEC     $5,600     2/10, n/3              0 5-DEC   $600               8-DEC

13-DEC    3,600      5/15, n/30            17-DEC    100                28-DEC

Instructions

Prepare all the journal entries for the above transactions

Coyote Company sold a merchandise costing $40,000 for $60,000 on credit to Beer Company on 4/1/2016. To expedite the cash payment, Coyote offered a cash discount of 2/15, n/30.

Instructions: prepare any necessary journal entries for the following transactions for the seller using the net method.

1) The credit sale on 4/1/2016.

2) A receipt of the full payment if it is paid on 4/14/2016.

3) A receipt of the full payment if it is paid on 4/24/2016.

P4. Coyote Company sold a merchandise costing $40,000 for $60,000 on credit to Beer Company on 4/1/2016. To expedite the cash payment, Coyote offered a cash discount of 2/15, n/30. Instructions: prepare any necessary journal entries for the following transactions for the seller using the net method. 1) The credit sale on 4/1/2016. 2) A receipt of the full payment if it is paid on 4/14/2016. 3) A receipt of the full payment if it is paid on 4/24/2016.

The trial balance before adjustment for ABC co. reports the following balances

Dr. Cr.

Accounts receivable $250,000

Allowance for doubtful accounts $500

Sales (all on credit) $1,180,000

Sales returns and allowance $150,000

Sales discount $30,000

Instructions: Prepare the entries for bad debt expense assuming the uncollectible amount be

1) 2% of gross account receivable and

2) 0.5% of net sales.