Two different companies, Ripper and Berners, entered into the following inventor
ID: 2579699 • Letter: T
Question
Two different companies, Ripper and Berners, entered into the following inventory transactions during December. Both companies use a perpetual inventory system. • December 3 – Ripper Corporation sold inventory on account to Berners Corp. for $481,000, terms 1/10, n/30. This inventory originally cost Ripper $310,000. • December 8 – Berners Corp. returned inventory to Ripper Corporation for a credit of $3,300. Ripper returned this inventory to inventory at its original cost of $2,127. • December 12 – Berners Corp. paid Ripper Corporation for the amount owed. Required: a. Prepare the journal entries to record these transactions on the books of Ripper Corporation. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 1. Record the entry for sale of inventory on account 2. Record the entry for cost of inventory sold on account from inventories 3. Record the entry for return of inventory sold on account 4. Record the entry for reversal of cost of inventory sold on account 5. Record the entry for receipt of accounts receivable and related sales discount for terms 1/10, n/30.B. What is the amount of net sales to be reported on Ripper Corporation’s income statement?
Net Sales: $.......
C. What is the Ripper Corporation’s gross profit percentage?
Gross Profit: ....... % Two different companies, Ripper and Berners, entered into the following inventory transactions during December. Both companies use a perpetual inventory system. • December 3 – Ripper Corporation sold inventory on account to Berners Corp. for $481,000, terms 1/10, n/30. This inventory originally cost Ripper $310,000. • December 8 – Berners Corp. returned inventory to Ripper Corporation for a credit of $3,300. Ripper returned this inventory to inventory at its original cost of $2,127. • December 12 – Berners Corp. paid Ripper Corporation for the amount owed. Required: a. Prepare the journal entries to record these transactions on the books of Ripper Corporation. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 1. Record the entry for sale of inventory on account 2. Record the entry for cost of inventory sold on account from inventories 3. Record the entry for return of inventory sold on account 4. Record the entry for reversal of cost of inventory sold on account 5. Record the entry for receipt of accounts receivable and related sales discount for terms 1/10, n/30.
B. What is the amount of net sales to be reported on Ripper Corporation’s income statement?
Net Sales: $.......
C. What is the Ripper Corporation’s gross profit percentage?
Gross Profit: ....... % Two different companies, Ripper and Berners, entered into the following inventory transactions during December. Both companies use a perpetual inventory system. • December 3 – Ripper Corporation sold inventory on account to Berners Corp. for $481,000, terms 1/10, n/30. This inventory originally cost Ripper $310,000. • December 8 – Berners Corp. returned inventory to Ripper Corporation for a credit of $3,300. Ripper returned this inventory to inventory at its original cost of $2,127. • December 12 – Berners Corp. paid Ripper Corporation for the amount owed. Required: a. Prepare the journal entries to record these transactions on the books of Ripper Corporation. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) 1. Record the entry for sale of inventory on account 2. Record the entry for cost of inventory sold on account from inventories 3. Record the entry for return of inventory sold on account 4. Record the entry for reversal of cost of inventory sold on account 5. Record the entry for receipt of accounts receivable and related sales discount for terms 1/10, n/30.
B. What is the amount of net sales to be reported on Ripper Corporation’s income statement?
Net Sales: $.......
C. What is the Ripper Corporation’s gross profit percentage?
Gross Profit: ....... %
Explanation / Answer
Journal entry No. Date Accpunting titles & Explanations Debit Credit 1) 3-Dec Accounts receivable 481,000 sales 481,000 2) 3-Dec Cost of goods sold 310,000 Merchandise Inventory 310,000 3) 8-Dec Sales return & allowance 3,300 Accounts receivable 3,300 4) 8-Dec Merchandise inventory 2,127 cost of goods sold 2,127 5) 12-Dec Cash 472,923 Sales discount (477,700*1%) 4777 Account receivable (481000-3300) 477,700 b) Net sales to be reported on Ripper's Corporations Income Statement Sales 481,000 less:Sales return & allowance -3,300 Sales discount -4,777 Net Sales 472,923 C) Gross Profit Gross profit/sales Net sales 472,923 cost of goods sold (310,000-2,127) 307873 Gross Profit 165,050 Gross profit % = 165,050/472,923 34.90%
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.