Presented here are selected transactions for Norlan Inc

during September #8566

Presented here are selected transactions for Norlan Inc during September

Presented here are selected transactions for Norlan Inc. during September of the current year.
Norlan uses a perpetual inventory system.

Sept. 2 Purchased equipment on account for $65,000, terms n/30, FOB destination.

3 Freight charges of $950 were paid by the appropriate party on the September 2 purchase of
equipment.

4 Purchased supplies for $4,000 cash.

6 Purchased inventory on account from Hillary Corp. at a cost of $65,000, terms 1/15, n/30,
FOB shipping point.

7 Freight charges of $1,600 were paid by the appropriate party on the September 6 inventory
purchase.

8 Returned damaged goods costing $5,000 that were originally purchased from Hillary on
September 4. Received a credit on account.

9 Sold goods costing $15,000 to Fischer Limited for $20,000 on account, terms 2/10, n/30, FOB
destination.

10 Freight charges of $375 were paid by the appropriate party on the September 9 sale of
inventory.

17 Received the balance due from Fischer.

20 Paid Hillary the balance due.

21 Purchased inventory for $6,000 cash.

22 Sold inventory costing $20,000 to Kun-Tai Inc. for $27,000 on account, terms n/30, FOB
shipping point.

23 Freight charges of $500 were paid by the appropriate party on the September 22 sale of
inventory.

28 Kun-Tai returned goods sold for $10,000 that cost $7,500. The merchandise was restored to
inventory.
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 Instructions

(a) Record the September transactions on Norlan's books.

(b) Assume that Norlan did not take advantage of the 1% purchase discount offered by Hillary
Corp. and paid Hillary on October 3 instead of September 20. Record the entry that Norlan
would make on October 3 and determine the cost of missing this purchase discount to Norlan.

Presented here are selected transactions for Norlan Inc during September

ANSWER
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