In: Accounting
Exceptional Electronics began operations September 1, 2019. The
firm sells its merchandise for cash and on open account. Sales are
subject to a 7 percent sales tax. During September, Exceptional
Electronics engaged in the following transactions:
DATE | TRANSACTIONS | |
2019 | ||
Sept. | 1 | Sold a high-definition television set on credit to Candy Cho; issued Sales Slip 101 for $2,700 plus sales tax of $189. |
3 | Sold stereo equipment on credit to Jim Peterson; issued Sales Slip 102 for $900 plus sales tax of $63. | |
7 | Sold a microwave oven on credit to Bridgette Huffman; issued Sales Slip 103 for $300 plus sales tax of $21. | |
12 | Accepted return of defective stereo equipment from Jim Peterson; issued Credit Memorandum 101 for $100 plus sales tax of $7. The stereo equipment was sold on September 3. | |
15 | Recorded cash sales for the period from September 1 to September 15 of $9,500 plus sales tax of $665. | |
16 | Sold a gas dryer on credit to Kathy Sundstrand; issued Sales Slip 104 for $600 plus sales tax of $42. | |
17 | Sold a home entertainment system on credit to Mark Navalta; issued Sales Slip 105 for $1,700 plus sales tax of $119. | |
18 | Received $730 from Candy Cho on account. | |
20 | Received payment in full from Jim Peterson for the sale of September 3, less the return of September 12. | |
25 | Gave Mark Navalta an allowance because of scratches on his home entertainment system sold on September 17, Sales Slip 105; issued Credit Memorandum 102 for $200 plus sales tax of $14. | |
27 | Received payment in full from Bridgette Huffman for the sale of September 7. | |
29 | Sold a dishwasher on credit to Mark Navalta; issued Sales Slip 106 for $400 plus sales tax of $28. | |
30 | Recorded cash sales for the period from September 16 to September 30 of $11,400 plus sales tax of $798. |
Required:
Record the transactions in a general journal.
Analyze:
What portion of the sales during September were for entertainment
items? Assume the cash sales transactions are for non-entertainment
items. (Hint: Do not forget to reduce sales by any sales returns or
allowances.)
Sold a high-definition television set on credit to Candy Cho; issued Sales Slip 101 for $2,700 plus sales tax of $189.
Note: Enter debits before credits.
|
Sold stereo equipment on credit to Jim Peterson; issued Sales Slip 102 for $900 plus sales tax of $63.
Note: Enter debits before credits.
|
Sold a microwave oven on credit to Bridgette Huffman; issued Sales Slip 103 for $300 plus sales tax of $21.
Note: Enter debits before credits.
|
Accepted return of defective stereo equipment from Jim Peterson; issued Credit Memorandum 101 for $100 plus sales tax of $7. The stereo equipment was sold on September 3.
Note: Enter debits before credits.
|
Recorded cash sales for the period from September 1 to September 15 of $9,500 plus sales tax of $665.
Note: Enter debits before credits.
|
Sold a gas dryer on credit to Kathy Sundstrand; issued Sales Slip 104 for $600 plus sales tax of $42.
Note: Enter debits before credits.
|
Sold a home entertainment system on credit to Mark Navalta; issued Sales Slip 105 for $1,700 plus sales tax of $119.
Note: Enter debits before credits.
|
Received $730 from Candy Cho on account.
Note: Enter debits before credits.
|
Received payment in full from Jim Peterson for the sale of September 3, less the return of September 12.
Note: Enter debits before credits.
|
Gave Mark Navalta an allowance because of scratches on his home entertainment system sold on September 17, Sales Slip 105; issued Credit Memorandum 102 for $200 plus sales tax of $14.
Note: Enter debits before credits.
|
Received payment in full from Bridgette Huffman for the sale of September 7.
Note: Enter debits before credits.
|
Sold a dishwasher on credit to Mark Navalta; issued Sales Slip 106 for $400 plus sales tax of $28.
Note: Enter debits before credits.
|
Recorded cash sales for the period from September 16 to September 30 of $11,400 plus sales tax of $798.
Note: Enter debits before credits.
|
Date | General Journal | Debit | Credit |
Sept 01, 2019 | Accounts receivable-Candy Cho. | 2889 | |
Sales revenue (Entertainment) | 2700 | ||
Sales tax payable | 189 | ||
(To record sales on account) | |||
Sept 03, 2019 | Accounts receivable-Jim Peterson | 963 | |
Sales revenue (Entertainment) | 900 | ||
Sales tax payable | 63 | ||
(To record sales on account) | |||
Sept 07, 2019 | Accounts receivable-Bridgette Huffman | 321 | |
Sales revenue (Non-Entertainment) | 300 | ||
Sales tax payable | 21 | ||
(To record sales on account) | |||
Sept 12, 2019 | Sales returns and allowances (Entertainment) | 100 | |
Sales tax payable | 7 | ||
Accounts receivable-Jim Peterson | 107 | ||
(To record sales returns) | |||
Sept 15, 2019 | Cash | 10165 | |
Sales revenue (Non-Entertainment) | 9500 | ||
Sales tax payable | 665 | ||
(To record cash sales) | |||
Sept 16, 2019 | Accounts receivable-Kathy Sundstrand | 642 | |
Sales revenue (Non-Entertainment) | 600 | ||
Sales tax payable | 42 | ||
(To record sales on account) | |||
Sept 17, 2019 | Accounts receivable-Mark Navalta | 1819 | |
Sales revenue (Entertainment) | 1700 | ||
Sales tax payable | 119 | ||
(To record sales on account) | |||
Sept 18, 2019 | Cash | 730 | |
Accounts receivable-Candy Cho. | 730 | ||
(To record collection on account) | |||
Sept 20, 2019 | Cash ($963 - $107) | 856 | |
Accounts receivable-Jim Peterson | 856 | ||
(To record collection on account) | |||
Sept 25, 2019 | Sales returns and allowances (Entertainment) | 200 | |
Sales tax payable | 14 | ||
Accounts receivable-Mark Navalta | 214 | ||
(To record sales allowance) | |||
Sept 27, 2019 | Cash | 321 | |
Accounts receivable-Bridgette Huffman | 321 | ||
(To record collection on account) | |||
Sept 29, 2019 | Accounts receivable-Mark Navalta | 428 | |
Sales revenue (Non-Entertainment) | 400 | ||
Sales tax payable | 28 | ||
(To record sales on account) | |||
Sept 30, 2019 | Cash | 12198 | |
Sales revenue (Non-Entertainment) | 11400 | ||
Sales tax payable | 798 | ||
(To record cash sales) |
Note: Sales revenue and sales returns and allowances have been identified as entertainment and non-entertainment for ease in understanding of the 'Analyze' portion.
Analyze:
Sales revenue (Entertainment) | 5300 |
Less: Sales returns and allowances (Entertainment) | 300 |
Net sales for entertainment items $ | 5000 |