| Item | Mfg. | Selling | P. L. |
| Insurance | ¾ | ¼ | 0 |
| Depreciation Auto Trucks | ½ | ½ | 0 |
| Taxes | ¾ | 0 | ¼ |
From the trial balance and the additional information prepare:
- (a) Income statement.
- (b) Balance sheet.
- (c) Journal entries to record the additional information
- and close the ledger.
Consignments, Commissions, Joint Venture
7. December 1, 1917, a New York merchant ships goods of the value of $5,000 on consignment to a commission merchant at Rio de Janeiro, insuring them in the Atlantic Mutual against loss or damage in transit and prepaying freight and insurance amounting to $250. On arrival the goods are found to be in a partially damaged condition and the loss is adjusted at $1,000, the certificates for which the consignee transmits to the consignor together with an account sales for $3,000, dated March 1, 1918, and a final account sales for $2,000, dated April 1, 1918. A draft on New York for $4,300 accompanied this final account, being the balance due after deducting duty paid and commission earned.
Give expression to these transactions on the books of the consignor.
8. On November 15, 1917, Isaac Cohen & Co., Ltd. sent for sale on their account a consignment of goods valued at $5,000 to John Stimson & Sons, factors of Boston; sale to be on a 5% basis with 1% additional for guaranty of collection of accounts. Prepaid freight amounted to $25.40. December 26, an account sales from Stimson & Sons showed sales of $5,775.20, and expenses in connection therewith, exclusive of commission and guaranty, of $42.25. The net proceeds were placed to Cohen & Co.’s credit, subject to sight draft.
(a) Show the alternative treatment of all the accounts affected on Cohen & Co.’s books in order either to show the profit or loss on this consignment, or to include the profit or loss with their regular sales.
(b) Stimson & Sons’ fiscal year ended November 30. On November 25 they had sold one-fourth of the Cohen & Co. consignment for $1,500 and had incurred the expenses of $42.25 mentioned above but applicable to the whole consignment. Show Stimson & Son’s accounts affected properly closed.
(c) If Cohen & Co.’s fiscal year ends on November 30, what entries would be needed to make the record in accord with the additional data of question (b) above?