Calculate Babcock's payment to Moonlight on November 13 for merchandise purchased on November 3....
Question:
Calculate Babcock's payment to Moonlight on November 13 for merchandise purchased on November 3.
The following were selected from among the transactions completed by Babcock Company during November of the current year:
| Nov. 3. | Purchased merchandise on account from Moonlight Co., list price $85,000, trade discount 25%, terms FOB destination, 2/10, n/30. |
| Nov. 4. | Sold merchandise for cash, $37,680. The cost of the merchandise sold was $22,600. |
| Nov. 5. | Purchased merchandise on account from Papoose Creek Co., $47,500, terms FOB shipping point, 2/10, n/30, with prepaid freight of $810 added to the invoice. |
| Nov. 6. | Returned $13,500 ($18,000 list price less trade discount of 25%) of merchandise purchased on November 3 from Moonlight Co. |
| Nov. 11. | Sold merchandise on account to Quinn Co., list price $24,000, trade discount 35%, terms 1/10, n/30. The cost of the merchandise sold was $9,400. |
| Nov. 13. | Paid Moonlight Co. on account for purchase of November 3, less return of November 6, and discount. |
| Nov. 14. | Sold merchandise on VISA, $236,000. The cost of the merchandise sold was $140,000. |
| Nov. 15. | Paid Papoose Creek Co. on account for purchase of November 5, less discount. |
| Nov. 21. | Received cash on account from sale of November 11 to Quinn Co., less discount. |
| Nov. 24. | Sold merchandise on account to Rabel Co., $56,900, terms 1/10, n/30. The cost of the merchandise sold was $34,000. |
| Nov. 28. | Paid VISA service fee of $3,540. |
| Nov. 30. | Received merchandise returned by Rabel Co. from sale on November 24, $8,400. The cost of the returned merchandise was $5,000. |
Accounts Payable:
Accounts payable represents the creditor's amount that is still not reimbursed by the company for credit acquisitions. They are recorded under the subhead' current liabilities' while preparing the statement of balance sheet. It consists of purchases entirely made on a credit basis.
Answer and Explanation: 1
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View this answerComputation of payment of purchases to be made on November 13:
| List price of goods | $85,000 |
| Less: Trade discount ($85,000 X 25%) | $ (21,250) |
| Actu... |
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