Question 1 The following transactions relate to the businesses of L. Lakemba and F. Fairlight....
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Accounting
Question 1
The following transactions relate to the businesses of L. Lakemba and F. Fairlight.
June
7
14
15
26
Lakemba sold goods to Fairlight for $3400. Terms were 2/10, n/30.
Fairlight paid Lakemba the net amount due.
Lakemba sold goods to Fairlight for $2470. Terms were 2/10, n/30.
Fairlight paid for the goods.
Required
Prepare general journal entries to record the above transactions (a) for L. Lakemba and (b) for F. Fairlight. Both companies use a periodic inventory system. (Assume neither is registered for GST.)
Question 2
Use the following information from the records of Preston Partners to prepare an income statement under the periodic inventory system for the year ended 30 June 2017.
Purchases
Inventory, 1 July 2016
Inventory, 30 June 2017
Selling and distribution expenses
Sales
Purchases returns and allowances
Sales returns and allowances
Administrative expenses
Freight inwards
Finance expenses
$
186 600
13 860
12 920
45 420
268 860
4 420
6 220
16 460
3 180
2 020
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