At the beginning of July, CD City has a balance in inventory of $2,450. The following transactions occur during the month of July. Purchase CDs on account from Wholesale Music for $1,350, terms 2/10, n/30. July 3 July 4 Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110. July 9 Return incorrectly ordered CDs to Wholesale Music and receive credit, $200. July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $3,900, that had a cost of $2,050. July 15 Receive full payment from customers related to the sale on July 12. July 18 Purchase CDs on account from Music Supply for $2,150, terms 2/10, n/30. July 22 Sell CDs to customers for cash, $3,250, that had a cost of $1,550. July 28 Return CDs to Music Supply and receive credit of $110. July 30 Pay Music Supply in full. Required: 1. Assuming that CD City uses a perpetual inventory system, record the transactions. 2. Prepare the top section of the multiple-step income statement through gross profit for the month of July.

At the beginning of July, CD City has a balance in inventory of $2,450. The following transactions occur during the month of July. Purchase CDs on account from Wholesale Music for $1,350, terms 2/10, n/30. July 3 July 4 Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110. July 9 Return incorrectly ordered CDs to Wholesale Music and receive credit, $200. July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $3,900, that had a cost of $2,050. July 15 Receive full payment from customers related to the sale on July 12. July 18 Purchase CDs on account from Music Supply for $2,150, terms 2/10, n/30. July 22 Sell CDs to customers for cash, $3,250, that had a cost of $1,550. July 28 Return CDs to Music Supply and receive credit of $110. July 30 Pay Music Supply in full. Required: 1. Assuming that CD City uses a perpetual inventory system, record the transactions. 2. Prepare the top section of the multiple-step income statement through gross profit for the month of July.

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter5: Accounting Systems

Section: Chapter Questions

Problem 14E: Guardian Services Inc. had the following transactions during the month of April: a. Record the June...

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nces At the beginning of July, CD City has a balance in Inventory of $2,650. The following transactions occur during the month of July. July 3 Purchase CDs on account from wholesale Music for $1,550, terms 2/10, 1/30. July 4 Pay cash for freight charges related to the July 3 purchase from wholesale Music, $100. July 9 Return incorrectly ordered CDs to wholesale Music and receive credit, $300. July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $4,300, that had a cost of $2,250. July 15 Receive full payment from customers related to the sale on July 12. July 18 Purchase CDs on account from Music Supply for $2,350, terms 2/10, 1/30. July 22 sell CDs to customers for cash, $3,450, that had a cost of $1,750. July 28 Return CDs to Husic Supply and receive credit of $150. July 30 Pay Music Supply in full. Required: 1. Assuming that CD City uses a perpetual Inventory system, record the transactions. 2. Prepare the top section of the multiple-step income statement…
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