On December 1, 2017, Prosen Distributing Company had the following account balan
ID: 2402998 • Letter: O
Question
On December 1, 2017, Prosen Distributing Company had the following account balances.
Debit
Credit
During December, the company completed the following summary transactions.
Supplies on hand $1,700.
e-Prepare an income statement.
27 Received collections in full, less discounts, from customers billed on December 18.
Debit
Credit
Cash $7,500 Accumulated Depreciation—Equipment $2,640 Accounts Receivable 4,600 Accounts Payable 4,900 Inventory 12,400 Salaries and Wages Payable 1,000 Supplies 1,400 Common Stock 30,000 Equipment 26,400 Retained Earnings 13,760 $52,300 $52,300 neyPLUS delei s auanagerial Accounting, 2e Help I System Announcements Comprehensive Problem 5 (Part Level Submission) On December 1, 2017, Prosen Distributing Company had the following account balances. Cash Accounts Receivable Inventory Supplies Equipment Debit $7,500 4,600 12,400 Credit $2,640 4.900 1,000 30,000 13,760 $52,300 Accumulated Depreciation - Equipment Accounts Payable Salaries and Wages Payable 1,400 Common Stock 26,400 Retained Earnings $52.300 During December, the company completed the following summary transactions. Dec. 5 Paid s1/800 for salaries and wages due employees, of which $800 is for December and $1,000 is for Novemb Received $1.900 cash from customers in payment of account (no discount allowed). 8 10 Sold merchandise for cash s6,80o. The cost of the merchandise sold was s4.200. 3 Purchased merchandise on account from Madlio Co. $8,900, terms 2/10. n/30. 15//7 Purchased supplies for cash $1.800. 18 Sold merchandise on account $12.60o, terms 3/10. n/30. The cost of the merchandise sold was $8,200. 20 Paid salaries and wages si1,500. 23// Paid Maglio Co. in full, less discount. 27/ Received collections in full, less discounts, from customers billed on December 18 r answer is partially correct. Try again. actioExplanation / Answer
Prosen Distributing Company Date Particular Amount (Dr) Amount (Cr) 6-Dec Salary & Wages Payable $ 1,000.00 Salaries & Wages $ 800.00 To Cash $ 1,800.00 (Being amount paid for salaries & wages) 8-Dec Cash $ 1,900.00 To Accouns Receivable $ 1,900.00 (Being amount of cash received from customers) 10-Dec Cash $ 6,800.00 To Sales $ 6,800.00 (Being amount of Sales) 10-Dec Cost of goods sold $ 4,200.00 To Mercendise Inventory $ 4,200.00 (Being amount of cost of goods sold) 13-Dec Merchandise Inventory $ 8,900.00 To Accounts Payable $ 8,900.00 (Beingnamount of Merchandise Inventory purchased on terms 2/10,n/30) 15-Dec Supplies $ 1,800.00 To Cash $ 1,800.00 (Being amount of Supplies purchased) 18-Dec Accounts Receivable $ 12,600.00 To Sales $ 12,600.00 (Being amount of Sales on terms 3/10,n/30) 18-Dec Cost of Goods Sold $ 8,200.00 To Merchandise Inventory $ 8,200.00 (Being amount of Cost of goods sold) 20-Dec Salaries & Wages $ 1,500.00 To Cash $ 1,500.00 (Being amount of Salaries & Wages Paid) 23-Dec Accounts Payable $ 8,900.00 To Cash($8900*98%) $ 8,722.00 To Merchandise Inventory($8900*2%) $ 178.00 (Being amount paid to Magilo after discount) 27-Dec Cash($12600*97%) $ 12,222.00 Sales return & allowances($12600*3%) $ 378.00 To Cash $ 12,600.00 (Being amount paid to customer after discount of 3%) Adjusting Entries 31-Dec Salaies & Wages $ 700.00 To Salaries & Wages outstanding $ 700.00 (Being amount of Salaries & Wages Payable) $ 240.00 31-Dec Depreciation $ 240.00 To Accumulated Depreciation-Equipment (Being amount of Depreciation) 31-Dec Supplies Expenses($1400+$1800-$1700) $ 1,500.00 To Supplies $ 1,500.00 (Being amount of Supplies Expenses) Income Statement Sales Revenue(Net)=($6800+$12600-378) $ 19,022.00 Less: Cost of goods sold=($4200+$8200) $ 12,400.00 Gross Profit $ 6,622.00 Less:Operating Expenses Salaries & Wages($800+$700) $ 1,500.00 Supplies Expenses $ 1,500.00 Depreciation $ 240.00 Net Income $ 3,382.00
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