Question

On April 6, 2018, Home Furnishings purchased $41,000 of merchandise from Una's Imports, terms 3/10 n/45. On April 8, Home Furnishings returned $8,600 of the merchandise to Una's Imports for credit. Home Furnishings paid cash for the merchandise on April 15, 2018.

Required

1. What is the amount that Home Furnishings must pay Una's Imports on April 15?

   	Net amount due.

2. Record the events in a horizontal statements model. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cell blank

   HOME FURNISHINGS Effect of Events on the Financial Statements Events Balance Sheet Income Statement Statement of Cash Flows Assets = Liabilities + Stockholders’ Equity Revenue – Expenses = Net Income Cash + Merchandise Inventory = Accounts Payable + Common Stock + Retained Earnings Purchase inventory + = + + – = Return inventory + = + + – = Discount percentage + = + + – = Paid accounts payable + = + + – =

   
   
3. How much must Home Furnishings pay for the merchandise purchased if the payment is not made until April 20, 2018?

1. 	Payment

2. Record the payment of the merchandise in Requirement (c) in a horizontal statements. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, NC for net change in cash and NA to indicate the element is not affected by the event.

   	HOME FURNISHINGS Effect of Events on the Financial Statements Events Balance Sheet Income Statement Statement of Cash Flows Assets = Liabilities + Stockholders’ Equity Revenue – Expenses = Net Income Cash + Merchandise Inventory = Accounts Payable + Common Stock + Retained Earnings Paid accounts payable + = + + – =

Answer 1