Alled Parts was organized on May 1, 2015, and made its first purchase ofl mercha

Question

Alled Parts was organized on May 1, 2015, and made its first purchase ofl merchandise on May 3. The a On May 7, Baker retums 357 units because they did not ft the oustomer's needs Allied Parts estores b. On May &Baker; discovers that 85 units are damaged but are still of some use and theretore keeps the the units to its inventory discovers hat 1 Allied Parts sends a $122 oredit memerandum to compensate. Baker retums the remaining 41 unts to Allied Parts. Allied Parts restores the 41 neturned units to its inventory Prepare entries for Allied Pats to necord the May 5 sale and each of the above separate trasactions using Journal entry worksheet Allied Parts sold 1.020 of the units for $12 per unit to Baker Co On May 5. Allied Parts sold 1.020 of the units for $12 per unit to Baker Co. Terms of the sale were 2/10, n/60. May 05 00

Explanation / Answer

2. SANTA FE COMPANY SOLUTION :

3.

Interest per year = Amount borrowed to pay with discount * Annual rate of interest = 26362 * 8% = $2108.96

Interest per day = $2108.96 / 365 days = $5.77

1. Allied parts solution Date General Journal Debit Credit may 5 accounts receivable 12240    sales 12240 ( sold merchandise on credit ) (1020 * $12 ) may 5 cost of goods sold 8160    merchandise inventory 8160 ( to record cost of sale ) (1020 * $8 ) may 7 sales returns and allowance 4284    accounts receivable 4284 ( accepted a return from customer ) (357 * $12 ) may 7 merchandise inventory 2856    cost of goods sold 2856 ( returned merchandise to inventory ) ( 357 * $8 ) may 8 sales returns and allowance 340    accounts receivable 340 may 15 sales returns and allowance 614    accounts receivable 614 ( accepted a return from a customer ) [122 + (41 * $12)] may 15 merchandise inventory 328    cost of goods sold 328 ( returned merchandise to inventory ) ( 41 * $8 )

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