Question

12. A company purchased $1,500 of merchandise on credit with terms 3/15, n/30. How much will be debited to Accounts Payable if the company pays $485 cash on this account within ten days?
A. $485; B. $500; C. $435; D. $470.45

13. A corporation uses a FIFO perpetual inventory system. During August, it had the following transactions:

August 1, Beginning inventory of 8 units @ $11 per unit
August 2, 25 units were purchased at $12 per unit.

August 15, 12 units were sold at $25 per unit.
August 18, 15 units were purchased at $14 per unit.

August 20. 18 units were sold at $25 per unit

August 28. 14 units were sold at $26 per unit

What was the amount of the ending inventory, and the cost of sales for the month of August?  

14. A company established a petty cash fund in March 1 of the current year and experienced the following transactions affecting the fund during the month:

Mar.1 Established a $300 petty cash fund.

5 Paid $45 to acquire break-room supplies

8 Re-imbursed a company employee for $35 spent on transportation to a meeting.

16 Paid $30 for stationery purchase and $23 for postage.

22 Paid freight of $29 for inventory purchase, FOB shipping, under a perpetual inventory system.

25 Cleaning expense $45

30 Paid emergency vehicle repairs cost of $63

31 Balance of cash in hand is $22
Required: Prepare the journal entry to reimburse the fund on March 31..

Answer 1

Q12.
Answer is B. 500.
Explanation:
Amount paid after discoount @3%				485
Gross amount to be paid (485/97* 100)				500
Q13.
STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL FIFO METHOD
	RECIEPTS			COST OF GOODS SOLD			BALANCE
DATE	UNITS	RATE	AMOUNT $	UNITS	RATE	AMOUNT $	UNITS	RATE	AMOUNT $
1-Aug							8	11	88
2-Aug	25	12	300				8	11	88
							25	12	300
15-Aug				8	11	88
				4	12	48	21	12	252
18-Aug	15	14	210				21	12	252
							15	14	210
20-Aug				18	12	216	3	12	36
							15	14	210
28-Aug				3	12	36
				11	14	154	4	14	56
TOTAL	40		510	44		542	4	14	56
			Ending inventory = 56
			Cost of goods sold = 542
Q14.
Journal entry for reimbursement:
Supplies account Dr.				45
Transportation expenses Dr.				35
Postage and stationary expenses Dr.				53
Merchandise invventory Dr.				29
Cleaning expense Dr.				45
Repairs expense Dr.				63
Cash Short and over account Dr.				8
Cash account					278