Question

Presented below is information for Cullumber Company for the month of January 2017.

Cost of goods sold $205,200 Rent expense $33,000
Freight-out 8,200 Sales discounts 8,800
Insurance expense 13,600 Sales returns and allowances 18,600
Salaries and wages expense 60,200 Sales revenue 393,500
Income tax expense 5,300 Other comprehensive income (net of $400 tax) 2,000

Required:
Journalize the above entries.

Answer 1

you cannot journalize these transactions. you can prepare an income statement which is not the same:

Sales revenue $393,500

Sales discounts ($8,800)

Sales allowances ($18,600) ($27,400)

Net sales revenue $366,100

Cost of goods sold ($205,200)

Gross profit $160,900

Operating expenses:

Rent ($33,000)

Freight out ($8,200)

Insurance ($13,600)

Salaries ($60,200) ($150,000)

Operating income $10,900

Income taxes ($5,300)

Net income $5,600

Other comprehensive income $2,000

Total income $7,600