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Record the Following Transactions for Sparky's Pet Shop Using the General

question 184

Essay

Record the following transactions for Sparky's Pet Shop using the general journal form provided below.Assume Sparky's uses a perpetual inventory system.Omit transaction descriptions from entries:
$\begin{array}{|r|l|}\hline \text { Date }&\text { Transaction } \\\hline \text {August 1 }&\text { Purchased \$ 6,000 of merchandise on account, terms 2/10, n/ 30 . }\\\hline 3&\text { Returned \$ 1,500 of merchandise purchased on August 1 due to defects. }\\\hline 7&\text { Recorded cash sales for the first week of August, \$ 9,750 ; cost of the }\\&\text { merchandise was \$ 4,000 . }\\\hline 10&\text { Made sale on account to a local breeder for \$ 500 , terms 1 / 10 net 30 ; cost of the }\\&\text { merchandise was \$ 200 }\\\hline 11&\text { Paid for the merchandise purchased on August 1, less return }\\\hline 20 &\text { Received payment from sale of August 10. }\\\hline \end{array}$
$Record the following transactions for Sparky's Pet Shop using the general journal form provided below.Assume Sparky's uses a perpetual inventory system.Omit transaction descriptions from entries: \begin{array}{|r|l|} \hline \text { Date }&\text { Transaction } \\ \hline \text {August 1 }&\text { Purchased \$ 6,000 of merchandise on account, terms 2/10, n/ 30 . }\\ \hline 3&\text { Returned \$ 1,500 of merchandise purchased on August 1 due to defects. }\\ \hline 7&\text { Recorded cash sales for the first week of August, \$ 9,750 ; cost of the }\\ &\text { merchandise was \$ 4,000 . }\\ \hline 10&\text { Made sale on account to a local breeder for \$ 500 , terms 1 / 10 net 30 ; cost of the }\\ &\text { merchandise was \$ 200 }\\ \hline 11&\text { Paid for the merchandise purchased on August 1, less return }\\ \hline 20 &\text { Received payment from sale of August 10. }\\ \hline \end{array}$

Understand the dividend yield and its relation to net income and market price per share.

Acknowledge the challenge of classifying highly diversified firms by industry.

Understand the factors affecting the return on common shareholders' equity, including leverage and debt ratios.

Assess the limitations of comparing basic earnings per share across companies and industries.

Definitions:

Par Value

The face value of a bond or stock, as stated by its issuer, which is the nominal value and does not necessarily reflect its market value.

Conversion Value

The value of a convertible security if it is converted into a specified number of shares of the issuing company.

Common Stock

Equity ownership in a corporation, with voting rights and the potential for dividends and capital appreciation.

Strike Price

The set price at which the holder of an option can buy (for a call option) or sell (for a put option) the underlying asset.