Answer:
A return of merchandise to the vendor results in a (B) credit to Purchases Returns and Allowances.
1. 2. The purchase of supplies on account results in a (A) credit to Accounts Payable.
Explanation:
A return of merchandise to the vendor results in a credit to Purchases Returns and Allowances.
Usually the double entry will be to:
Dr Account Payable or Account Receivable - to net off liability for the purchases now returned (Dr Account Payable) or to show that we are expecting refund for the return of merchandise (Dr Account Receivable)
AND
Cr Purchases Returns and Allowances or Inventory Account, to take account of the reduction in purchases and/or inventory.
1. 2. The purchase of supplies on account results in a (A) credit to Accounts Payable because when goods are purchased on credit we need to show that the amount for the goods are to be paid, so the credit goes to Account Payable rather than cash/bank
Answer: $58600
Explanation:
The net income that would have been if the allowance method had been used, and the company estimated that 2.5% of sales would be uncollectible will be calculated thus:
= Reported net income + Uncollectible - (Sales × % Uncollectible)
= $63800 + $9300 - ($580000 × 2.5%)
= $63800 + $9300 - $14500
= $58600
Answer:
Option C - $543,000 is the correct option.
Explanation:
Using the direct method:
Cash from operating activities = Revenue + Decrease in trade receiables
= $526,000 + ($138,000 - $121,000) = $526,000 + $17,000 = $543,000
So this is the amount that would be reported in Statement of cash flow under operating activities.
The answer to your question is TRUE
Answer:
a) Historical Cost principle
b) Economic entity assumption
c) Full disclosure principle
d) Monetary unit assumption
e) Materiality principle
f) Conservatism
g) Matching principle
h) Historical cost principle