Coronado Corporation Consignment Sales Journal Entry

What is Coronado Corporation's journal entry when the cash is received from Gooch Company for consignment sales?

How can we calculate the amount of cash Coronado will receive from Gooch Company?

Coronado Corporation's Journal Entry:

When the cash is received from Gooch Company for consignment sales, Coronado's journal entry will be as follows:

Debit: Cash $19,641

Credit: Sales Revenue $19,641

To prepare Coronado Corporation's journal entry when the cash is received, we need to calculate the amount of cash that Coronado will receive from Gooch Company. This can be done by subtracting Gooch's commission and the reimbursable advertising costs from the total sales amount.

First, calculate Gooch's commission: $22,100 x 9% = $1,989

Next, subtract the commission and advertising costs from the total sales amount: $22,100 - $1,989 - $470 = $19,641

The journal entry reflects the cash received from Gooch Company for the consignment sales, net of commission and advertising costs.