These two Sales Revenue accounts (the sales returns and sales allowances) are classified as <em>Contra accounts.</em> They have debit balances unlike the Sales Revenue account.
- The purpose of their creation is to maintain the Sales Revenue account at its gross amount for measure purposes.
- The Sales Returns account is the General Ledger account for recording goods returned by customers. It reduces the Accounts Receivable account, which is credited with Sales Returns.
- The Sales Allowances account records allowances granted to customers for defective goods, which reduce their balances.
Thus, the two sales accounts are contra accounts and they have debit balances.
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Answer:
The gain of $8,000 is recognized and the bonds have a basis of $35,000
Explanation:
Please see attachment
Answer:
She is bound by the regulations.
Explanation:
It is Mary's duty to know if the insurance regulations published in the Federal Register have been adopted by Congress. The purpose of using the Federal Register is to inform US citizens of all pending legislations. The publication in the Federal Register is, therefore, considered as a sufficient legal requirement for compliance with public notices.
Answer:
The cost of units completed this period is $ 350,000
Explanation:
<u><em>Units Out of the Process Were:</em></u>
Finished Goods = 50,000
Ending Work In Progress = 2500
<u>1.) Finished Goods Equivalent Units</u>
Materials : Finished Goods are 100% complete in terms of materials hence 50000 equivalent units
Conversion : Finished Goods are 100% complete in terms of conversion costs hence 50000 equivalent units
<u> 2.) Cost of units completed Units</u>
Materials : 50000 × 5.75 =287500
Conversion : 50000×1.25 =62500
Total = 287500 + 62500 = $ 350,000
<em>*Note Ending Inventory is not relevant for this question</em>
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Answer:
A) $514,000.
Explanation:
Operating income = Gross profit - Operating expenses
Operating income = $629,000 - $115,000
Operating income = $514,000
