Question

 Howie Jewelers uses a perpetual inventory system and had the following purchase transactions. Journalize all necessary transactions. Explanations are not required.

 Journalize all necessary transactions in the order they are presented in the transaction list.

 Jun. 20: Purchased inventory of $5,100 on account from Sanders Diamonds, a jewelry importer. Terms were 2/15, n/45, FOB shipping point

Answer 1

Solution:
Date	Accounts	Debit	Credit
20-Jun	Inventory	$5,100
	Accounts Payable- Sanders Diamond		$5,100
	(To record purchase of Inventory)
20-Jun	Inventory	$400
	Cash		$400
	(To record freight charges paid)
4-Jul	Accounts Payable- Sanders Diamond	$600
	Inventory		$600
	(To record inventory returned to supplier)
14-Jul	Accounts Payable- Sanders Diamond	$4,500
	Cash		$4,500
	(To record payment made to Sanders Diamond)
	($5100-$600)
	(If payment made upto 5 th july , 2% Cash discount would
	be received, Payment terms 2/15)
16-Jul	Inventory	$3,500
	Accounts Payable- Southboro Diamond		$3,500
	(To record purchase of Inventory)
18-Jul	Accounts Payable -Southboro Diamond	$300
	Inventory		$300
	(To record allowance for damaged but usable goods)
24-Jul	Accounts Payable -Southboro Diamond ($3500-$300)	$3,200
	Inventory (3500-300)*2%		$                                      64
	Cash		$                                 3,136
	(To record payment made to Southboro diamond)
	(If payment made upto 26 th july , 2% Cash discount would
	be received, Payment terms 2/10)