North South University

ACT 201

ACT201 Mid Term Fall 2021 Instructor: Ani Total Marks: 45 PROBLEMS 1) Meraki Company began its’ operation of distributing hardcover books to retail stores on January 1, 2019. Meraki extends credit terms of 2/10, n/30 to all of its customers. During January 2021 the business was engaged in the following selected transactions: January 1 Invested $280,000 cash in the company as the sole owner. 1 Purchased supplies for $3,900, paying 75% of the total amount in cash and the rest on account from Red Supply Company. 5 Purchased merchandise on account from Caleb Co. $2,500, FOB shipping Point, terms 1/15, n/60. The appropriate party also made cash payment of $95 for freight cost. 8 Purchased equipment costing $45,000 on account. 13 Received credit from Caleb Co. for merchandise returned $800. 15 Withdrew $1,500 cash for personal use. 18 Sold merchandise to Newman Co. on account for $2,850, FOB shipping point. The merchandise sold had a cost of $1,300. 20 Paid remaining cash on balance owed for supplies and 8