Principles of Accounting Volume 1
19th Edition
ISBN: 9781947172685
Author: OpenStax
Publisher: OpenStax College
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Chapter 12, Problem 8PB
Air Compressors Inc. purchases compressor parts for its inventory from a supplier. The following transactions take place during the current year:
A. On April 5, the company purchases 400 parts for $8.30 per part, on credit. Terms of the purchase are 4/ 10, n/30, invoice dated April 5.
B. On May 5, Air Compressors does not pay the amount due and renegotiates with the supplier. The supplier agrees to $400 cash immediately as partial payment on note payable due, converting the debt owed into a short-term note, with a 7% annual interest rate, payable in three months from May 5.
C. On August 5, Air Compressors pays its account in full.
Record the
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Serene Company purchases fountains for its inventory from
Kirkland Inc. The following transactions take place during
the current year.
A. On July 3, the company purchases 30 fountains for
$2,200 per fountain, on credit. Terms of the purchase are
2/10, n/30, invoice dated July 3.
B. On August 3, Serene does not pay the amount due and
renegotiates with Kirkland. Kirkland agrees to convert the
debt owed into a short-term note, with an 9% annual
interest rate, payable in two months from August 3.
C. On October 3, Serene Company pays its account in full.
Record the journal entries to recognize the initial purchase,
the conversion, and the payment. If an amount box does
not require an entry, leave it blank. When required,
round your answers to the nearest dollar.
July 3
Aug. 3
Oct. 3
Accounts Payable
Cash
Interest Expense
Merchandise Inventory
Short-Term Notes Payable
II II 1II
II II III
10. Serene Company purchases fountains for its inventory from Kirkland Inc. The following
transactions take place during the current year.
A. On July 3, the company purchases thirty fountains for $3114 per fountain, on credit.
Terms of the purchase are 2/10, n/30, invoice dated July 3.
B. On August 3, Serene does not pay the amount due and renegotiates with Kirkland.
Kirkland agrees to convert the debt owed into a short-term note, with an 8% annual
interest rate, payable in two months from August 3.
C. On October 3, Serene Company pays its account in full.
Record the journal entries to recognize the initial purchase, the conversion, and the payment.
Serene Company purchases fountains for its inventory from Kirkland Inc. The following transactions take place during the current year.
A. On July 3, the company purchases 30 fountains for $1,700 per fountain, on credit. Terms of the purchase are 2/10, n/30, invoice dated July 3.
B. On August 3, Serene does not pay the amount due and renegotiates with Kirkland. Kirkland agrees to convert the debt owed into a short-term note, with an 10% annual interest rate, payable in two months from August 3.
C. On October 3, Serene Company pays its account in full.
Record the journal entries to recognize the initial purchase, the conversion, and the payment. If an amount box does not require an entry, leave it blank. When required, round your answers to the nearest dollar.
July 3
fill in the blank 2
fill in the blank 3
fill in the blank 5
fill in the blank 6
Aug. 3
fill in the blank 8
fill in the blank 9
fill in the blank 11
fill in the blank 12
Oct. 3
fill in the blank 14…
Chapter 12 Solutions
Principles of Accounting Volume 1
Ch. 12 - Which of the following is not considered a current...Ch. 12 - A company regularly purchases materials from a...Ch. 12 - The following is selected financial data from...Ch. 12 - A ski company takes out a $400,000 loan from a...Ch. 12 - Nido Co. has a standing agreement with a supplier...Ch. 12 - A client pays cash in advance for a magazine...Ch. 12 - Lime Co. incurs a $4,000 note with equal principal...Ch. 12 - Which of the following best describes a contingent...Ch. 12 - Blake Department Store sells television sets with...Ch. 12 - What accounts are used to record a contingent...
Ch. 12 - Which of the following best describes a contingent...Ch. 12 - Which of the following accounts are used when a...Ch. 12 - Which of the following is not a characteristic of...Ch. 12 - Sunlight Growers borrows $250,000 from a bank at a...Ch. 12 - Marathon Peanuts converts a $130,000 account...Ch. 12 - An employee earns $8,000 in the first pay period....Ch. 12 - Which of the following is considered an employer...Ch. 12 - Employees at Rayon Enterprises earn one day a...Ch. 12 - An employee and employer cost-share health...Ch. 12 - Why is Accounts Payable classified as a current...Ch. 12 - On which financial statement are current...Ch. 12 - What is the difference between a noncurrent...Ch. 12 - How is the sales tax rate usually determined? Does...Ch. 12 - If Bergen Air Systems takes out a $100,000 loan,...Ch. 12 - What amount is payable to a state tax board if the...Ch. 12 - What specific accounts are recognized when a...Ch. 12 - What is a contingent liability?Ch. 12 - What are the two FASB required conditions for a...Ch. 12 - If a bankruptcy is deemed likely to occur and is...Ch. 12 - Name the four contingent liability treatments.Ch. 12 - A companys sales for January are $250,000. If the...Ch. 12 - What is a key difference between a short-term note...Ch. 12 - What business circumstance could bring about a...Ch. 12 - What business circumstance could produce a...Ch. 12 - Jain Enterprises honors a short-term note payable....Ch. 12 - What are examples of involuntary deductions...Ch. 12 - What are the tax rates for FICA Social Security...Ch. 12 - What are FUTA and SUTA taxes? Is there any...Ch. 12 - Use Figure 12.15 as a reference to answer the...Ch. 12 - Campus Flights takes out a bank loan in the amount...Ch. 12 - Consider the following accounts and determine if...Ch. 12 - Lamplight Plus sells lamps to consumers. The...Ch. 12 - Review the following transactions and prepare any...Ch. 12 - Review the following transactions and prepare any...Ch. 12 - Elegant Electronics sells a cellular phone on...Ch. 12 - Homeland Plus specializes in home goods and...Ch. 12 - Bhakti Games is a chain of board game stores....Ch. 12 - Following is the unadjusted trial balance for Sun...Ch. 12 - Barkers Baked Goods purchases dog treats from a...Ch. 12 - Use information from EA10. Compute the interest...Ch. 12 - Scrimiger Paints wants to upgrade its machinery...Ch. 12 - Following are payroll deductions for Mars Co....Ch. 12 - Toren Inc. employs one person to run its solar...Ch. 12 - In EA14, you prepared the journal entries for the...Ch. 12 - An employee and employer cost-share pension plan...Ch. 12 - Everglades Consultants takes out a loan in the...Ch. 12 - Match each of the following accounts with the...Ch. 12 - Pianos Unlimited sells pianos to customers. The...Ch. 12 - Review the following transactions and prepare any...Ch. 12 - Review the following transactions and prepare any...Ch. 12 - Monster Drinks sells twenty-four cases of...Ch. 12 - McMasters Inc. specializes in BBQ accessories. In...Ch. 12 - Following is the unadjusted trial balance for Pens...Ch. 12 - Airplanes Unlimited purchases airplane parts from...Ch. 12 - Use information from EB9. Compute the interest...Ch. 12 - Whole Leaves wants to upgrade their equipment, and...Ch. 12 - Reference Figure 12.15 and use the following...Ch. 12 - Marc Associates employs Janet Evanovich at its...Ch. 12 - In EB13, you prepared the journal entries for...Ch. 12 - An employee and employer cost-share 401(k) plan...Ch. 12 - Consider the following situations and determine...Ch. 12 - Stork Enterprises delivers care packages for...Ch. 12 - Review the following transactions, and prepare any...Ch. 12 - Review the following transactions, and prepare any...Ch. 12 - Review the following transactions, and prepare any...Ch. 12 - Machine Corp. has several pending lawsuits against...Ch. 12 - Emperor Pool Services provides pool cleaning and...Ch. 12 - Serene Company purchases fountains for its...Ch. 12 - Mohammed LLC is a growing consulting firm. The...Ch. 12 - Lemur Corp. is going to pay three employees a...Ch. 12 - Record the journal entries for each of the...Ch. 12 - Consider the following situations and determine...Ch. 12 - Perfume Depot sells two different tiers of perfume...Ch. 12 - Review the following transactions, and prepare any...Ch. 12 - Review the following transactions and prepare any...Ch. 12 - Review the following transactions and prepare any...Ch. 12 - Roundhouse Tools has several potential warranty...Ch. 12 - Shoe Hut sells custom, handmade shoes. It offers a...Ch. 12 - Air Compressors Inc. purchases compressor parts...Ch. 12 - Pickles R Us is a pickle farm located in the...Ch. 12 - Use Figure 12.15 to complete the following...Ch. 12 - Use the information from PB10 to complete this...
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