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On January 1, 2024, the general ledger of Tripley Company included the following account balances: Accounts Debit Credit Cash $ 274,000   Accounts receivable 74,000   Allowance for uncollectible accounts   $ 37,400 Inventory 33,400   Building 243,400   Accumulated depreciation   44,000 Land 248,600   Accounts payable   190,000 Notes payable (8%, due in 3 years)   240,000 Common stock   119,600 Retained earnings   242,400 Totals $ 873,400 $ 873,400 The $33,400 beginning balance of inventory consists of 334 units, each costing $100. During January 2024, the company had the following transactions: January 2 Lent $54,000 to an employee by accepting a 6% note due in six months. January 5 Purchased 5,200 units of inventory on account for $572,000 ($110 each) with terms 110/110 , n30/�30 . January 8 Returned 100 defective units of inventory purchased on January 5. January 15 Sold 5,000 units of inventory on account for $820,000 ($164 each) with terms 210/210 , n30/�30 . January 17 Customers returned 200 units sold on January 15. These units were initially purchased by the company on January 5. The units are placed in inventory to be sold in the future. January 20 Received cash from customers on accounts receivable. This amount includes $39,400 from 2023 plus amount receivable on sale of 4,400 units sold on January 15. January 21 Wrote off remaining accounts receivable from 2023. January 24 Paid on accounts payable. The amount includes the amount owed at the beginning of the period plus the amount owed from purchase of 4,800 units on January 5. January 28 Paid cash for salaries during January, $62,000. January 29 Paid cash for utilities during January, $44,000. January 30 Paid dividends, $6,400. Month-end adjusting entries: Of the remaining accounts receivable, the company estimates that 10% will not be collected. Accrued interest revenue on notes receivable for January. Accrued interest expense on notes payable for January. Accrued income taxes at the end of January for $8,400. Depreciation on the building, $5,400.

On January 1, 2024, the general ledger of Tripley Company included the following account balances: Accounts Debit Credit Cash $ 274,000   Accounts receivable 74,000   Allowance for uncollectible accounts   $ 37,400 Inventory 33,400   Building 243,400   Accumulated depreciation   44,000 Land 248,600   Accounts payable   190,000 Notes payable (8%, due in 3 years)   240,000 Common stock   119,600 Retained earnings   242,400 Totals $ 873,400 $ 873,400 The $33,400 beginning balance of inventory consists of 334 units, each costing $100. During January 2024, the company had the following transactions: January 2 Lent $54,000 to an employee by accepting a 6% note due in six months. January 5 Purchased 5,200 units of inventory on account for $572,000 ($110 each) with terms 110/110 , n30/�30 . January 8 Returned 100 defective units of inventory purchased on January 5. January 15 Sold 5,000 units of inventory on account for $820,000 ($164 each) with terms 210/210 , n30/�30 . January 17 Customers returned 200 units sold on January 15. These units were initially purchased by the company on January 5. The units are placed in inventory to be sold in the future. January 20 Received cash from customers on accounts receivable. This amount includes $39,400 from 2023 plus amount receivable on sale of 4,400 units sold on January 15. January 21 Wrote off remaining accounts receivable from 2023. January 24 Paid on accounts payable. The amount includes the amount owed at the beginning of the period plus the amount owed from purchase of 4,800 units on January 5. January 28 Paid cash for salaries during January, $62,000. January 29 Paid cash for utilities during January, $44,000. January 30 Paid dividends, $6,400. Month-end adjusting entries: Of the remaining accounts receivable, the company estimates that 10% will not be collected. Accrued interest revenue on notes receivable for January. Accrued interest expense on notes payable for January. Accrued income taxes at the end of January for $8,400. Depreciation on the building, $5,400.

Quickbooks Online Accounting
Quickbooks Online Accounting
3rd Edition
ISBN:9780357391693
Author:Owen
Publisher:Owen
Chapter5: Operating Activities: Purchases And Cash Payments
Section: Chapter Questions
Problem 4.13C
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On January 1, 2024, the general ledger of Tripley Company included the following account balances:

Accounts Debit Credit
Cash $ 274,000  
Accounts receivable 74,000  
Allowance for uncollectible accounts   $ 37,400
Inventory 33,400  
Building 243,400  
Accumulated depreciation   44,000
Land 248,600  
Accounts payable   190,000
Notes payable (8%, due in 3 years)   240,000
Common stock   119,600
Retained earnings   242,400
Totals $ 873,400 $ 873,400

The $33,400 beginning balance of inventory consists of 334 units, each costing $100. During January 2024, the company had the following transactions:

January 2 Lent $54,000 to an employee by accepting a 6% note due in six months.
January 5 Purchased 5,200 units of inventory on account for $572,000 ($110 each) with terms 110/110 , n30/�30 .
January 8 Returned 100 defective units of inventory purchased on January 5.
January 15 Sold 5,000 units of inventory on account for $820,000 ($164 each) with terms 210/210 , n30/�30 .
January 17 Customers returned 200 units sold on January 15. These units were initially purchased by the company on January 5. The units are placed in inventory to be sold in the future.
January 20 Received cash from customers on accounts receivable. This amount includes $39,400 from 2023 plus amount receivable on sale of 4,400 units sold on January 15.
January 21 Wrote off remaining accounts receivable from 2023.
January 24 Paid on accounts payable. The amount includes the amount owed at the beginning of the period plus the amount owed from purchase of 4,800 units on January 5.
January 28 Paid cash for salaries during January, $62,000.
January 29 Paid cash for utilities during January, $44,000.
January 30 Paid dividends, $6,400.

Month-end adjusting entries:

  1. Of the remaining accounts receivable, the company estimates that 10% will not be collected.
  2. Accrued interest revenue on notes receivable for January.
  3. Accrued interest expense on notes payable for January.
  4. Accrued income taxes at the end of January for $8,400.
  5. Depreciation on the building, $5,400. 

 

No Date General Journal 1 January 02 Notes receivable Cash Debit Credit 2 January 05 Inventory Accounts payable 00 00 54.000 54,000 572.000 672.000 3 January 08 Accounts payable Inventory 00 11,000 11,000 4 January 15 Accounts receivable ° 820,000 Sales revenue ° 820,000 5 January 16 Cost of goods sold Inventory 00 550,000 O 550,000 • January 17 Salesu ° 32,000- Accounts receivable ° 32.800 7 January 17 Inventory Cost of goods sold 00 22.000 22.000 January 20 Cash ° 761,600 Accounts receivable ° 761,600 O 9 January 21 Allowance for uncollectible accounts Accounts receivable 10 January 24 Accounts payable Cash 11 January 28 Salaries expense Cash 00 00 00 34,600 ° 34,600 12 January 29 xpans Canh 00 718,000 718,000 62.000 62.000 44.000 44.000 13 January 30 Dividends Cash 00 ° 6.400 6400 14 = January 31 Baddible Allowance for uncollectible accounts 00 9840 9.840 O 15 January 31 Interest receivable ° 2700 Interest revenue ° 2700 16 January 31 ° 1,600 Interest payable ° 1,600 17 = January 31 Income tax expense Income payable 18 January 31 Depreciation expense ° 8.400 ° 8,400 ° 5.400 Accumulated depreciation ° 5.400 O 19 January 31 787200 R 20 January 31 Sales revenue Interest revenue Retained earnings Retained earnings Sales retu Cost of goods sold Salaries expense Uses expense Baddele Depreciation expense Interest expen Dividends 1.600 O 690040 O 788.800 000 000000000 32.800 528,000 62.000 44,000- 9840 5,400 1.600 6.400
Transcribed Image Text:No Date General Journal 1 January 02 Notes receivable Cash Debit Credit 2 January 05 Inventory Accounts payable 00 00 54.000 54,000 572.000 672.000 3 January 08 Accounts payable Inventory 00 11,000 11,000 4 January 15 Accounts receivable ° 820,000 Sales revenue ° 820,000 5 January 16 Cost of goods sold Inventory 00 550,000 O 550,000 • January 17 Salesu ° 32,000- Accounts receivable ° 32.800 7 January 17 Inventory Cost of goods sold 00 22.000 22.000 January 20 Cash ° 761,600 Accounts receivable ° 761,600 O 9 January 21 Allowance for uncollectible accounts Accounts receivable 10 January 24 Accounts payable Cash 11 January 28 Salaries expense Cash 00 00 00 34,600 ° 34,600 12 January 29 xpans Canh 00 718,000 718,000 62.000 62.000 44.000 44.000 13 January 30 Dividends Cash 00 ° 6.400 6400 14 = January 31 Baddible Allowance for uncollectible accounts 00 9840 9.840 O 15 January 31 Interest receivable ° 2700 Interest revenue ° 2700 16 January 31 ° 1,600 Interest payable ° 1,600 17 = January 31 Income tax expense Income payable 18 January 31 Depreciation expense ° 8.400 ° 8,400 ° 5.400 Accumulated depreciation ° 5.400 O 19 January 31 787200 R 20 January 31 Sales revenue Interest revenue Retained earnings Retained earnings Sales retu Cost of goods sold Salaries expense Uses expense Baddele Depreciation expense Interest expen Dividends 1.600 O 690040 O 788.800 000 000000000 32.800 528,000 62.000 44,000- 9840 5,400 1.600 6.400
Assets Current assets: Tripley Company Balance Sheet January 31, 2024 Current liabilities: Liabilities Cash 151,200 Accounts payable Accounts receivable 65,000 Interest payable Allowance for uncollectible accounts (2,800) Income tax payable 000 33,000 0 0 Inventory 66,400 Total current liabilities 33,000 Interest receivable 0 Notes payable 240,000 Notes receivable 54,000 0 Total current assets 333,800 Total liabilities 273,000 Noncurrent Assets: Stockholders' equity Buildings 243,400 Allowance for uncollectible accounts Land 2,800 Common stock Retained earnings 119,600 389,200 248,600 0 0 Total assets $ 828,600 Total stockholders' equity Total liabilities and stockholders' equity 508,800 $ 781,800 Analyze how well Tripley Company manages its inventory (a) Calculate the inventory turnover ratio for the month of January. If the industry average of the inventory turnover ratio for the month of January is 4.5 times, is the company selling its inventory more or less quickly than other companies in the same industry? The inventory turnover ratio is: times The company is managing its inventory more efficiently. (true or false) (b) Calculate the gross profit ratio for the month of January. If the industry average gross profit ratio is 50%, is the company more or less profitable per dollar of sales than other companies in the same industry? The gross profit ratio is: The company is more profitable than other companies. % (c) Used together, what might the inventory turnover ratio and gross profit ratio suggest about the company's business strategy? Is the company's strategy to sell a higher volume of less expensive items or does the company appear to be selling a lower volume of more expensive items? The company's business strategy appears to be selling
Transcribed Image Text:Assets Current assets: Tripley Company Balance Sheet January 31, 2024 Current liabilities: Liabilities Cash 151,200 Accounts payable Accounts receivable 65,000 Interest payable Allowance for uncollectible accounts (2,800) Income tax payable 000 33,000 0 0 Inventory 66,400 Total current liabilities 33,000 Interest receivable 0 Notes payable 240,000 Notes receivable 54,000 0 Total current assets 333,800 Total liabilities 273,000 Noncurrent Assets: Stockholders' equity Buildings 243,400 Allowance for uncollectible accounts Land 2,800 Common stock Retained earnings 119,600 389,200 248,600 0 0 Total assets $ 828,600 Total stockholders' equity Total liabilities and stockholders' equity 508,800 $ 781,800 Analyze how well Tripley Company manages its inventory (a) Calculate the inventory turnover ratio for the month of January. If the industry average of the inventory turnover ratio for the month of January is 4.5 times, is the company selling its inventory more or less quickly than other companies in the same industry? The inventory turnover ratio is: times The company is managing its inventory more efficiently. (true or false) (b) Calculate the gross profit ratio for the month of January. If the industry average gross profit ratio is 50%, is the company more or less profitable per dollar of sales than other companies in the same industry? The gross profit ratio is: The company is more profitable than other companies. % (c) Used together, what might the inventory turnover ratio and gross profit ratio suggest about the company's business strategy? Is the company's strategy to sell a higher volume of less expensive items or does the company appear to be selling a lower volume of more expensive items? The company's business strategy appears to be selling
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