Financial Accounting

Business 1101: Assignment 4

November 7th, 2013

P5-2A

Hall Drug Store

Date | Account Titles and Explanations | Debit | Credit |

Feb 6 | Inventory | 60,000 | |

| Accounts Payable | | 60,000 |

| Purchase Inventory on account. | | |

Feb 6 | Inventory | 1,000 | |

| Cash | | 1,000 |

| Paid freight bill. | | |

Feb 10 | Accounts Payable | 5,000 | |

| Inventory | | 5,000 |

| Returned inventory to seller. | | |

Feb 15 | Accounts Payable | 24,000 | |

| Cash | | 23,760 |

| Inventory | | 240 |

| Paid partial amounts on account within discount period. | | |

Feb 27 | Accounts Payable | 31,000 | |

| Cash | | 31,000 |

Chao Pharmaceuticals

Date | Account Titles and Explanations | Debit | Credit |

Feb 6 | Accounts Receivable | 60,000 | |

| Sales Revenue | | 60,000 |

| Sale on account. | | |

Feb 6 | Cost of goods sold | 36,000 | |

| Inventory | | 36,000 |

| Recorded the count of goods sold. | | |

Feb 10 | Sales Return | 5,000 | |

| Accounts Receivable | | 5,000 |

| Received returned goods. | | |

Feb 10 | Inventory | 3,000 | |

| Cost of goods sold | | 3,000 |

| Return goods to inventory. | | |

Feb 15 | Cash | 23,760 | |

| Sales Discounts | 240 | |

| Accounts Receivable | | 24,000 |

| Cash collected within the discount period. | | |

Feb 27 | Cash | 31,000 | |

| Accounts Receivable | | 31,000 |

| Collection on account. | | |

P5-8A

1.

Date | Account Titles and Explanations | Debit | Credit |

1 | Sales Revenue | 112,500 | |

| Income Summary | | 112,500 |

| To close the revenue account and create the income summary. | | |

2 | Income Summary | 98,950 | |

| Sales Returns | | 3,000 |

| Cost of goods sold | | 67,500 |

| Selling expenses | | 16,850 |

| General expenses | | 10,500 |

| Interest expenses | | 1,100 |

| To close...