Question

On April 6, Year 1, Home Furnishings purchased $25,200 of merchandise from Una Imports, terms 2/10 n/45. On April 8, Home returned $2,400 of the merchandise to Una Imports for credit. Home paid cash for the merchandise on April 15, Year 1.

What is the balance in the Accounts Payable account after the purchase, return, discount and payment have been recorded?

What is the balance in the Inventory account after the purchase, return, discount and payment transactions have been recorded?

Answer 1

Solution :
	Account Payable	Amount
	After the purchase as on April . 06	$                    25,200
	As on April 08, After the purchase retrun
	Accounts Payable	$                    25,200
	Less: Purchase Returns	$                       2,400
	Balance in Accounts Payable	$                    22,800
	As on April 15, After the purchase Discount
	Accounts Payable	$                    22,800
	Less: Purchase Discount ($ 22,800 X 2%)	$                          456
	Balance in Accounts Payable	$                    22,344
	As on April 15, After the Payment have been recorded
	Accounts Payable	$                    22,344
	Less: Payment made in cash	$                    22,344
	Balance in Accounts Payable	$                              -
	Inventory Account	Amount
	After the purchase as on April . 06- Inventory Purchased =	$                    25,200
	As on April 08, After the purchase retrun
	Inventory Purchase	$                    25,200
	Less: Purchase Returns	$                       2,400
	Balance in Inventory Account	$                    22,800
	As on April 15, After the purchase Discount
	Balance in Inventory Account	$                    22,800
	Less: Purchase Discount ($ 22,800 X 2%)	$                          456
	Balance in Inventory Account After Discount	$                    22,344
	As on April 15, After the Payment have been recorded
	Balance in inventory account after the payment =	$                    22,344
	(This is recorded as current assets and this will remain same after the making of payment also)