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Individual Assignment on Merchandise Firms

The document outlines a series of transactions completed by Montrose Company and Capers Company related to merchandise purchases and sales during May and October of the current year. It includes details on purchases, sales, returns, and payments, specifying terms and conditions for each transaction. The exercise serves as a practical application for accounting principles in merchandising firms.

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30 views

Individual Assignment on Merchandise Firms

The document outlines a series of transactions completed by Montrose Company and Capers Company related to merchandise purchases and sales during May and October of the current year. It includes details on purchases, sales, returns, and payments, specifying terms and conditions for each transaction. The exercise serves as a practical application for accounting principles in merchandising firms.

Uploaded by

mrtar53
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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CPU BUSINESS AND INFORMATION TECHNOLOGY COLLEGE

DEPARTMENT OF ACCOUNTING AND FINANCE


FUNDAMENTALS OF ACCOUNTING-I
EXERCISE ON ACCOUNTING FOR MERCHANDISING FIRM
1. The following transactions were completed by Montrose Company during May of the current
year.
May 3. Purchased merchandise on account from Floyd Co., $4,000, terms FOB shipping point, 2/10, n/30,
with prepaid freight of $120 added to the invoice.
5. Purchased merchandise on account from Kramer Co., $8,500, terms FOB destination, 1/10, n/30.
6. Sold merchandise on account to C. F. Howell Co., list price $4,000, terms 2/10, n/30.
8. Purchased office supplies for cash, $150.
10. Returned merchandise purchased on May 5 from Kramer Co., $1,300.
13. Paid Floyd Co. on account for purchase of May 3, less discount.
14. Purchased merchandise for cash, $10,500.
15. Paid Kramer Co. on account for purchase of May 5, less return of May 10 and discount.
16. Received cash on account from sale of May 6 to C. F. Howell Co., less discount.
19. Sold merchandise on MasterCard credit cards, $2,450.
22. Sold merchandise on account to Comer Co., $3,480, terms 2/10, n/30.
24. Sold merchandise for cash, $4,350. The cost of the merchandise sold was $1,750.
25. Received merchandise returned by Comer Co. from sale on May 22, $1,480.
Instruction

Record the above transaction?

2. Purchase-related transactions
The following selected transactions were completed by Capers Company during October of the current year :
Oct. 1. Purchased merchandise from UK Imports Co., $14,448, terms FOB destination, n/30.
3. Purchased merchandise from Hoagie Co., $9,950, terms FOB shipping point, 2/10, n/eom. Prepaid freight
of $220 was added to the invoice.
4. Purchased merchandise from Taco Co., $13,650, terms FOB destination, 2/10, n/30.
6. Issued debit memo to Taco Co.for $4,550 of merchandise returned from purchase on October 4.
13. Paid Hoagie Co. for invoice of October 3, less discount.
14. Paid Taco Co. for invoice of October 4, less debit memo of October 6 and discount.
19. Purchased merchandise from Veggie Co., $27,300, terms FOB shipping point, n/eom.
19. Paid freight of $400 on October 19 purchase from Veggie Co.
20. Purchased merchandise from Caesar Salad Co., $22,000, terms FOB destination, 1/10, n/30.
30. Paid Caesar Salad Co. for invoice of October 20, less discount.
31. Paid UK Imports Co. for invoice of October 1.
31. Paid Veggie Co. for invoice of October 19.

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