26 Project 5 Merchandise Sales with Discount Fidos Food Mart

26 Project #5: Merchandise Sales with Discount Fido\'s Food Mart Adjusted Trial Balance December 31,20Xx Debits Credits Account Title 50,938 12,250 84,720 650 320 30,550 12,250 Cash Accounts receivable Inventory Supplies Prepaid insurance Equipment Vehicle Accumulated depreciation - Equipment and vehicle Accounts payable Unearned revenue (gift cards) Bonds payable (mature 12/31/XX Common stock (200 shares@ $210/share, par $210) Retained earnings Sales revenue Less: sales discount Cost of goods sold Operating expenses 0 62,128 275 12,000 42,000 132,725 0 34,840 Depreciation expense Insurance expense Rent expense Supplies expense Wages expense Totals 160 5,750 1,200 15,500 249,128 249,128

Solution

Cash 1960 50*98%*40 Cash discount 40 To Sales 2000 This impact will have increase in Sales revenue credit to 132725+2000 134725 Cash will increase by (50938+1960) 52898 Sales discount will be 40 Sales A/c Debit Credit Balance Opening Balance 132725 132725 Add : Sales 2000 134725 Closing Balance 134725 Cash discount Debit Credit Opening Balance 0 0 40 0 Closing Balance 40 0 Cash Debit Credit Balance Opening Balance 50938 0 50938 1960 0 52898 Closing Balance 52898 0 Cost of goods sold = 25*40 1000 Fido\'s Food Mart Adjusted Trial Balance December 31, 20XX Account Title Debits Adjusted Total Credits Adjusted Total Cash 50938 1960 52898 Accounts receivable 12250 12250 Inventory 84720 -1000 83720 Supplies 650 650 Prepaid Insurance 320 320 Equipment 30550 30550 Vehicle 12250 12250 Accumulated-Depreciation 0 0 Accounts payable 62128 62128 Unearned revenue 275 275 Bonds payable 12000 12000 Common Stock 42000 42000 Retained earnings 0 0 Sales Revenue 132725 2000 134725 Less: Sales discount 0 40 40 Cost of Goods Sold 0 1000 1000 Operating Expenses 34840 34840 Depreciation expense 0 0 Insurance expense 160 160 Rent expense 5750 5750 Supplies Expense 1200 1200 Wages expense 15500 15500 251128 251128