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1.Cottonwood received their new product catalogs ordered from a local print shop. The print shop billed Cottonwood $6,000 for 5,000 catalogs with payment terms of net 10. Cottonwood considers catalogs as advertising and expenses the catalogs at the end of the month based on how many catalogs are sent out during the month.2. Cottonwood received an order from the FFA rodeo in LaJunta Colorado, (LJ FFA), for $19,820 in event merchandise. The Cottonwood customer service representative confirmed that the LJ FFA Rodeoâs account was paid current and they had sufficient credit available to cover the new sale. The order was then sent to the warehouse where it was picked and prepared for shipping. The merchandise was shipped via UPS at a cost of $170, which was paid by Cottonwood. Cost of the merchandise shipped was $12,584. Terms of the sale are net 30.3. Cottonwood received an order from the Del Norte County Rodeo in Trinity, CA for $18,000 of resale merchandise. This is a new rodeo with no credit history. Cottonwood has requested payment in full prior to the delivery of goods. The cost of the goods ordered is $10,440.
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