Question

In: Accounting

The following transactions were selected from among those completed by Hailey Retailers in 2013

 The following transactions were selected from among those completed by Hailey Retailers in 2013: Nov. 20 Sold two items of merchandise to Customer B, who charged the $480 sales price on her Visa credit card. Visa charges Hailey a 2 percent credit card fee.

 25 Sold 14 items of merchandise to Customer C at an invoice price of $3,400 (total); terms 3/10, n/30.

 28 Sold 12 identical items of merchandise to Customer D at an invoice price of $8,160 (total); terms 3/10, n/30.

 30 Customer D returned one of the items purchased on the 28th; the item was defective, and credit was given to the customer.

 Dec. 06 Customer D paid the account balance in full.

 30 Customer C paid in full for the invoice of November 25, 2013.

 Required:

 1-a. Prepare the appropriate jounal entry for each of these transactions, assuming the company records sales revenue under the gross method. Do not record cost of goods sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

 1 Sold two items of merchandise to Customer B, who

 charged the $480 sales price on her Visa credit card. Visa charges Hailey a 2 percent credit card fee.

 2 Sold 14 items of merchandise to Customer C at an invoice price of $3400 (total); terms 3/10, n/30.

 3 Sold 12 identical items of merchandise to Customer D at an invoice price of $8160 (total); terms 3/10, n/30.

 4 Customer D returned one of the items purchased on the 28th; the item was defective, and credit was given to the customer.

 5 Customer D paid the account balance in full.

 6 Customer C paid in full for the invoice of November 25, 2013.


 1-b. Compute Net Sales.


Solutions

Expert Solution

Journal entries:
Date Accounts title and explanations Debit $ Credit$
20-Nov Cash account Dr. 470.4
Card service expenses Dr. (480*2%) 9.6
     Sales revenue 480
25-Nov Accounts receivable Dr. 3400
    Sales revenue 3400
28-Nov Accounts receivable Dr. 8160
    Sales revenue 8160
30-Nov Sales return and allowance Dr. 680
     Accounts receivable 680
6-Dec Cash account Dr. 7255.6
Sales discount Dr. (7480*3%) 224.4
    Accounts receivable 7480
30-Dec Cash account Dr. 3400
    Accounts receivable 3400
Net sales revenue:
Gross Sales revenue (480+3400+8160) 12040
Less: Sales return and allowance 680
Less: Sales discount 224.4
Net sales revenue: 11135.6

ekkarill92 answered 1 year ago
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