Li Corp. purchased a container load of antiques for resale at an invoice cost of $1,500,000. The goods were paid for when they were shipped in early June. The container arrived in Canada at the end of August, and then at Li's location, by rail, at the end of September. The goods were then available for sale. Freight costs of $157,500 were paid in October. Li has recorded $112,500 of total interest expense from $2,500,000 of general borrowing over the year. Required: Prepare the adjusting journal entry to capitalize borrowing costs on inventory at year-end December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) No 1 Transaction 1 Inventory Frieght charges Interest expense Answer is not complete. General Journal ✓ X X Debit 74,588 X Credit

Li Corp. purchased a container load of antiques for resale at an invoice cost of $1,500,000. The goods were paid for when they were shipped in early June. The container arrived in Canada at the end of August, and then at Li's location, by rail, at the end of September. The goods were then available for sale. Freight costs of $157,500 were paid in October. Li has recorded $112,500 of total interest expense from $2,500,000 of general borrowing over the year. Required: Prepare the adjusting journal entry to capitalize borrowing costs on inventory at year-end December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) No 1 Transaction 1 Inventory Frieght charges Interest expense Answer is not complete. General Journal ✓ X X Debit 74,588 X Credit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Li Corp. purchased a container load of antiques for resale at an invoice cost of $1,600,000. The goods were paid for when they were shipped in early June. The container arrived in Canada at the end of August, and then at Li's location, by rail, at the end of September. The goods were then available for sale. Freight costs of $168,000 were paid in October. Li has recorded $100,800 of total interest expense from $2,400,000 of general borrowing over the year. Required: Prepare the adjusting journal entry to capitalize borrowing costs on inventory at year-end December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) X Answer is not complete. No Transaction General Journal Debit Credit 1 1 No journal entry required
Li Corp. purchased a container load of antiques for resale at an invoice cost of $1,600,000. The goods were paid for when they were shipped in early June. The container arrived in Canada at the end of August, and then at Li's location, by rail, at the end of September. The goods were then available for sale. Freight costs of $168,000 were paid in October. Li has recorded $100,800 of total interest expense from $2,400,000 of general borrowing over the year. Required: Prepare the adjusting journal entry to capitalize borrowing costs on inventory at year-end December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) View transaction list EX: Record entry to capitalize borrowing cost. 1 Credit
Blossom Corporation shipped $21,900 of merchandise on consignment to Cullumber Company. Blossom paid freight costs of $2,100. Cullumber Company paid $550 for local advertising, which is reimbursable from Blossom. By year-end, 65% of the merchandise had been sold for $21,900. Cullumber notified Blossom, retained a 10% commission, and remitted the cash due to Blossom. Prepare Blossom's journal entry when the cash is received. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Account Titles and Explanation (To record the cash remitted to Blossom.) (To record the cost of inventory sold on consignment.) Debit 11 Credit 1
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On October 5, 2024, the Lalisa Trading Company consigned 48 computer units, costing P 8,000 each, to Jennie, Inc. The units were to be sold on either cash or credit basis at a commission of 15% of net sales. Lalisa paid freight of P 1,800 on the shipment. On November 11, Jennie received the goods. Sales were made as follows: · October 15 – 10 units for cash at P 13,000 each · October 28 – 12 units on account at P 14,000 each On October 31, 2024, collections on accounts amounted to P 95,000, and an allowance of P 2,000 was given to a charge customer for a defective unit. On November 15, 2024, Jennie made the proper remittance of cash received from customers. Required: 1. Determine the amount of remittance 2. Determine the consignment profit 3. Determine the cost of ending inventory on consignment
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Indigo Corporation shipped $25,000 of merchandise on consignment to Sandhill Company. Indigo paid freight costs of $1,900. Sandhill Company paid $400 for local advertising, which is reimbursable from Indigo. By year end, 60% of the merchandise had been sold for $20,500. Sandhill notified Indigo, retained a 10% commission, and remitted the cash due to Indigo. Prepare Indigo’s journal entry when cash is received. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit enter an account title to record revenue enter a debit amount enter a credit amount enter an account title to record revenue enter a debit amount enter a credit amount enter an account title to record revenue enter a debit amount enter a credit amount enter an account title to record revenue enter a…
Vaughn Corporation shipped $18,400 of merchandise on consignment to Gooch Company. Vaughn paid freight costs of $2,000. Gooch Company paid $540 for local advertising, which is reimbursable from Vaughn. By year-end, 63% of the merchandise had been sold for $21,200. Gooch notified Vaughn, retained a 9% commission, and remitted the cash due to Vaughn. Prepare Vaughn's journal entry when the cash is received. (Round answers to O decimal places, e.g. 1,525. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit Cash Commission Expense Advertising Expense (To record the cash remitted to Vaughn.) (To record the cost of inventory sold on consignment.) 18752 1908 540 21200
Salman and Adnan Corporation purchased typesetting equipment having a list price of Rs. 306,000 from a manufacturing in the Z area. Credit terms for the transaction were 2/10, n/30. Salman and Adnan Corporation paid the invoice within the discount period, as well as an additional 7% sales tax on the net price. Other payments relating to the acquisition of the equipment were a freight bill of Rs. 3,894 and a labor cost for installing the equipment of Rs. 6,315. During the installation process, an accident caused damage to the equipment, which was repaired at cost of Rs. 7,500. As soon as the equipment was in place, the company obtained insurance on it for a premium of Rs. 2,700. Required: Compute the Cost of Equipment. Calculate the depreciation for first three years using declining method at twice the normal rate, assume that the machine has 6 years useful life and have an estimated value of Rs. 38,000. At the time of disposal (after 6 years) cash Rs. 45,000 were received from Ahmed…
Carla Vista Corporation shipped $20,100 of merchandise on consignment to Wildhorse Company. Carla Vista paid freight costs of $2,000. Wildhorse Company paid $510 for local advertising, which is reimbursable from Carla Vista. By year-end, 58% of the merchandise had been sold for $20,100. Wildhorse notified Carla Vista, retained a 10% commission, and remitted the cash due to Carla Vista. Prepare Carla Vista's journal entry when the cash is received. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.)
On October 1, CLARK Co shipped 25 cameras to KENT Inc on consignment. The cameras are to be sold at list price of P20,000 each. The cost of each camera to the consignor is P10,000. The cost of shipment paid by the consignor was P7,500. The consignor agreed to absorb the consignee’s expenditure for freight and also to allow the consignee P1,000 for delivery and installation for each set. Commission is to be 25% of the sales price. On October 31, KENT submitted the following summary of consignment sales: Sets received 25 Sets sold 8 Sets returned to consignor (defective) 2 10 Sets on hand 15 October 2-30 sales, 8 cameras@20,000 160,0000 Charges: Freight in 5,000 Deliveries and installation expenses 8,000 Commissions 40,000 53,000 Total 107,000 Remittance 25,000 Balance owed (collections from customers not yet made ) 82,000 What is the inventory value of the units unsold in the hands of the consignee?A. 150,000 C.…
On October 1, CLARK Co shipped 25 cameras to KENT Inc on consignment. The cameras are to be sold at list price of P20,000 each. The cost of each camera to the consignor is P10,000. The cost of shipment paid by the consignor was P7,500. The consignor agreed to absorb the consignee’s expenditure for freight and also to allow the consignee P1,000 for delivery and installation for each set. Commission is to be 25% of the sales price. On October 31, KENT submitted the following summary of consignment sales: Sets received 25 Sets sold 8 Sets returned to consignor (defective) 2 10 Sets on hand 15 October 2-30 sales, 8 cameras@20,000 160,0000 Charges: Freight in 5,000 Deliveries and installation expenses 8,000 Commissions 40,000 53,000 Total 107,000 Remittance 25,000 Balance owed (collections from customers not yet made ) 82,000 What is the profit of the consignor for the units sold?