In: Accounting
During the months of January and February, Solitare Corporation sold goods to two customers. The sequence of events was as follows: Jan. 6 Sold goods for $100 to Wizard Inc. with terms 2/30, n/60. The goods cost Solitare $70. 6 Sold goods to Spyder Corp. for $80 with terms 5/10, n/60. The goods cost Solitare $60. 14 Collected cash for the amount due from Wizard Inc. Feb. 28 Collected cash for the amount due from Spyder Corp. Required: Compute the total revenue Solitare would report over the two months.
Answer :
Total revenue Solitare would report over the two months is $ 178 with a gross profit of $ 48.
Particulars | Amount ($) |
Sales (January & February ) | |
Wizard Inc |
$ 100 |
Spyder Corp |
80 |
Less : Discount allowed to Wizard Inc ($100 × 2%) | ( 2) |
Net Sales | $ 178 |
Less : Cost of goods sold (70 + 60) | (130) |
Gross Profit | $ 48 |
Notes-
Wizard Inc made full payments on Jan 14th ( 8 days) and so they are given 2% discount.
Spyder Corp made payments only on Feb 28th (more than 10 days) hence, not entitled to any discounts. Full amount due is collected.