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KengaRu [80]
3 years ago
14

On March 5, 2020, Northwest Co. purchased $400,000 in merchandise on account with credit terms of 1/15, n/45. Purchases were all

made f.o.b. shipping point. Northwest paid freight charges of $7,500. Merchandise with an invoice amount of $5,000 was returned for credit on March 12, 2020. Northwest paid the vendor for the amount owe on March 17, 2020. Assuming Northwest uses a perpetual inventory system and the gross method to record purchases, what journal entry would Northwest record for the payment made on March 17, 2020
Business
2 answers:
LekaFEV [45]3 years ago
7 0

Answer:

The journal entry would be as follows:

                                     Debit                Credit

Accounts payable        $395,000

                                      Cash                $391,050

                                       Inventory         $3,950

Explanation:

In order to prepare the journal entry would Northwest record for the payment made on March 17, 2020, we have to calculate according to the given data the following:

Northwest Co. purchased $400,000 in merchandise on account with credit terms of 1/15, n/45, and Merchandise with an invoice amount of $5,000 was returned for credit on March 12, 2020, hence, ross amount due = Amount of purchase - return = $400,000-$5,000 = $395,000 will be debited to Accounts payable .

Discount will be allowed as payment made within 15 dyas , hence Discount will be = 1% of $395,000 = $3,950 which will be credited to inventory .

Net amount paid will be credit to cash = $395,000-$3,950 = $391,050.

Therefore, the journal entry would be as follows:

                                     Debit                Credit

Accounts payable        $395,000

                                      Cash                $391,050

                                       Inventory         $3,950

NikAS [45]3 years ago
5 0

Answer:

Net amount paid = 391050

Explanation:

Accounts payable =395,000

Cash =391,050

Inventory =3,950

Accounts payable =396,000

Cash =396,000

Accounts payable =395,000

Purchase discount  =3,950

Cash =398,950

Accounts payable =400,000

Cash =396,000

Purchase discount =4,000

Accounts payable  = 395,000

Cash  = 391,050

Inventory  = 3,950

 

Gross amount due = Amount of purchase - return = 400000-5000 = 395000 will be debited to Accounts payable

Discount will be allowed as payment made within 15 dyas

Disount will be = 1% of 395000 = 3950 which will be credited to inventory

Net amount paid will be credit to cash = 395000-3950 = 391050

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Depletion glacier mining co. acquired mineral rights for $494,000,000. the mineral deposit is estimated at 475,000,000 tons. dur
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Let the amount invested

at 5.75% = X

at 7.25% = Y

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X + Y = $44,000 ( Eq 1)

and

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By multiplying ( Eq 1) with 0.0575

0.0575X + 0.0575Y = $2,530 ( Eq 3)

By subtracting ( Eq 3) from ( Eq 2)

0.0725Y - 0.0575Y = $2,740 - $2,530

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5 0
3 years ago
Pattison Products, Inc., began operations in October and manufactured 40,000 units during the month with the following unit cost
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Answer:

Following are the responses to the given question:

Explanation:

For question 1:

Calculating the cost per unit:

\text{Direct material}\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \$5\\\\\text{Direct labor} \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \  \ \ \$3\\\\\text{Variable overhead}\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \$1.5\\\\\text{Fixed overhead}\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \$7\\\\\text{Cost per unit}\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \$16.5\\\\

For question 2:

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= \text{Beginning inventory + units produced - ending inventory}\\\\= 0+40,000-38,400\\\\= 1600\ units\\\\

Calculating the cost for the Ending inventory:

=1600\ units \times \$16.5\\\\=\$26,400\\\\

For question 3:

Calculating the absorption costing for the income statement:

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Sales (38,400\times \$24)\ \ \ \ \ \ \ \ \ \   \ \ \ \ \ \ \ \ \ \ \ \ \ \$921,600

-COGS(38,400\times \$16.5)\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \  \ \ \  \$633,600

Gross profit                                          \$288,000

Cost of variable marketing  (\$1.2\times 38,400)\ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \  \$46,080

marketing and administrative costs are fixed \$130,500

Net income                                            \$111,420

6 0
3 years ago
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