
Serial Problem — SP 4 (Continued)
Jan. 17 Accounts Payable ..........................................201 5,800
Accounts Receivable—Liu Corp. ...........106.5 500
Customer returned defective goods.
* Business Solutions leaves the cost of defective
products in its costs of goods sold. If it did not,
the following entry would have been recorded:
Collected accounts receivable.
January 13 sale ..................................... $5,200
January 20 return ................................... 500
Amount due from Liu ............................. $4,700
Discount at 1% ....................................... 47
Accounts Payable ...................................201 9,000
Purchased merchandise for resale.
26 Accounts Receivable—KC, Inc ......................106.8 5,800
Sales .........................................................413 5,800
Sold merchandise on credit.
Paid employee wages.