Reference no: EM132583954
Mark's Music is a store that buys and sells musical instruments and uses a perpetual inventory system. Mark's is a public company following IFRS and records revenue using the contract-based approach. Management estimates that 10% of sales will be returned by customers within 15 days from date of sale.
Nov.
2 Purchased two electric guitars from Fender Supply Limited, on account, at a cost of $650 each, terms 1/10, n/60.
4 Made a cash sale of two keyboards for a total invoice price of $2,310. The cost of each keyboard was $870.
5 Received a credit from Western Acoustic Inc. for the return of an acoustic guitar, which was defective. The original invoice price was $360 and the guitar had been purchased on account.
7 One of the keyboards from the cash sale of Nov. 4 was returned to the store for a full cash refund because the customer was not satisfied with the instrument. Each keyboard cost $870 each. The keyboard was returned to inventory.8
Purchased store supplies from a stationery store. The price of the supplies is $90.
10 Sold one Omega trumpet to the Toronto Regional Band, on account, for an invoice price of $2,780. Terms are n/30. The trumpet had cost Mark's Music $1,310.
10 Made a payment on account for the amount owing to Fender Supply Limited for the purchase of Nov. 2.
13 Purchased two saxophones from Yamaha Canada Inc. on account. The invoice price was $2,300 for each saxophone. Terms are 1/10, n/30.
16 Returned to Yamaha Canada Inc. one of the saxophones purchased on Nov. 13, as it was the wrong model. Received a credit from Yamaha for the full purchase price.
20 Received a cheque for the appropriate amount from the Toronto Regional Band for the purchase of Nov. 10.
22 Paid balance owing to Yamaha Canada Inc.
Question 1: Prepare the journal entries to record the transactions of Mark's Music. (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. Record journal entries in the order presented in the problem.)