Identify the adjustments that need to be made in that period in terms of the accrual principle

Anonymous
timer Asked: Jun 5th, 2016
account_balance_wallet $30

Question description

Option #1: Bicycle Shop Invoicing

Assume you are the owner of Victory Cycle Shop and just received an order of bikes from Roseville. You notice that the invoice dated September 22 has terms of 2/10, n/30. The amount of the invoice was originally $1,000.

The payment was made on September 29; however, the clerk failed to book the transaction on September 22.

Identify the adjustments that need to be made in that period in terms of the accrual principle. 

Explain how to journalize and how to make the adjustments for the proper accounting period.

Address the following items in your response:

  • What is your motivation for offering the sales discount?
  • Identify three incentives customers would face to not pay the invoice within the discount period.

Your response should include 2-3 pages of written text in addition to any calculations and solutions you offer to support your thinking. Document formatting and any citations should conform to APA requirements.


Tutor Answer

tifanny578
School: UC Berkeley

Hello. Here is the complete work. Thank you

Running head: BICYCLE SHOP INVOICING

Option # 1: Bicycle Shop Invoicing
Name
ACT 301- Financial Accounting
University Name
Professor Name
Date

1

BICYCLE SHOP INVOICING

2

Bicycle Shop Invoicing
Adjustments to accrual principle
Accrual accounting matches incomes with costs for a specific period and this is the
premise of the coordinating standard. Accrual accounting requires that costs be composed with
the income that was made from those costs. The costs for a period, consequently, should
incorporate the rate of benefits that was spent amid the period. This coordinating is done as such
that the net wage reported is as exact as would be prudent. To ensure that the costs of a
bookkeeping period are coordinated with the incomes, sections are made toward the end of a
bookkeeping period to "change" the record adjusts as needs be. (Bookkeeping Coach) Adjusting
passages dependably include no less than one salary explanation record and one asset report
account.
Sale discounts
A sales discount is an impetus the dealer offers in return for brief installment on layaway
deals. The terms 2/10, n/30 mean the client may take a two percent markdown on the
extraordinary equalization if installment happens inside ten days of the receipt date. In the event
that the client picks not to take the markdown, the exceptional equalization is expected inside
thirty days. Thus, to answer this player in the inquiry: you see that...

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Anonymous
Outstanding Job!!!!

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