Question

At the beginning of the current season on April 1, the records of Flounder Pro Shop showed Cash $2,940, Inventory $3,500, and Common Stock $6,440. The following transactions occurred during April 2017.

Apr. 5		Purchased golf bags, clubs, and balls on account from Arnie Co. $2,000.
9		Received credit from Arnie Co. for merchandise returned $600.
10		Sold merchandise on account to members $1,390. The merchandise sold had a cost of $750.
12		Purchased golf shoes, sweaters, and other accessories on account from Woods Sportswear $1,070.
14		Paid Arnie Co. in full.
17		Received credit from Woods Sportswear for merchandise returned $70.
20		Made sales on account to members $930. The cost of merchandise sold was $550.
21		Paid Woods Sportswear in full.
30		Received payments on account from members $1,280.

Prepare a tabular summary that includes the following accounts: Cash, Accounts Receivable, Inventory, Accounts Payable, Common Stock, Sales Revenue, Sales Returns and Allowances, and Cost of Goods Sold. Enter the beginning balances in the summary, Record the April transactions using a perpetual inventory system. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) and Prepare an income statement through gross profit for the month of April 2017.

Answer 1

			Accounts				Accounts		Common		Sales		Sales Returns		Cost of
Date	Cash	+	Receivable	+	Inventory	=	Payable	+	Stock	+	Revenue	-	and Allow.	-	Goods sold
Beg. Bal.	$ 2,940.00				$ 3,500.00				$ 6,440.00
05-Apr					$ 2,000.00		$ 2,000.00
09-Apr					$ -600.00		$    -600.00
10-Apr			$ 1,390.00								$ 1,390.00
					$ -750.00										$    750.00
12-Apr					$ 1,070.00		$ 1,070.00
14-Apr	$ -1,400.00						$ -1,400.00
17-Apr					$     -70.00		$      -70.00
20-Apr			$     930.00								$    930.00
					$ -550.00										$    550.00
21-Apr	$ -1,000.00						$ -1,000.00
30-Apr	$ 1,280.00		$ -1,280.00
Total	$ 1,820.00		$ 1,040.00		$4,600.00		$              -		$6,440.00		$2,320.00		$                 -		$1,300.00

	Income Statement
	Sales		$ 2,320.00
Less:	Cost of Goods sold		$ 1,300.00
	Gross Margin		$ 1,020.00