Answer all.
Sales-Related and Purchase-Related Transactions Using Perpetual Inventory System The following were selected from among the transactions completed by Babcock Company during November of the current year:
Nov. 3. | Purchased merchandise on account from Moonlight Co., list price $89,000, trade discount 30%, terms FOB destination, 2/10, n/30. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4. | Sold merchandise for cash, $40,040. The cost of the goods sold was $20,620. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5. | Purchased merchandise on account from Papoose Creek Co., $47,400, terms FOB shipping point, 2/10, n/30, with prepaid freight of $830 added to the invoice. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
6. | Returned $11,900 ($17,000 list price less trade discount of 30%) of merchandise purchased on November 3 from Moonlight Co. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8. | Sold merchandise on account to Quinn Co., $16,430 with terms n/15. The cost of the merchandise sold was $10,090. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
13. | Paid Moonlight Co. on account for purchase of November 3, less return of November 6. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
14. | Sold merchandise on VISA, $238,360. The cost of the goods sold was $140,040. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
15. | Paid Papoose Creek Co. on account for purchase of November 5. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
23. | Received cash on account from sale of November 8 to Quinn Co. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
24. | Sold merchandise on account to Rabel Co., $51,400, terms 1/10, n/30. The cost of the goods sold was $36,370. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
28. | Paid VISA service fee of $3,360. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30. |
Paid Quinn Co. a cash refund of $6,530 for returned merchandise from sale of November 8. The cost of the returned merchandise was $3,240 1- Journalize the transactions.
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Perpetual inventory
Net method used
Journal Entries:
Date | Account title and Explanation | Debit | Credit |
Nov. 3 | Merchandise Inventory [89,000 x 70% x 98%] | $61,054 | |
Accounts Payable-Moonlight Co. | $61,054 | ||
[To record purchase of merchandise on account] | |||
Nov. 4-sale | Cash | $40,040 | |
Sales | $40,040 | ||
[To record cash sales] | |||
Nov. 4-cost | Cost of Goods Sold | $20,620 | |
Merchandise Inventory | $20,620 | ||
[To record cost of goods sold] | |||
Nov. 5 | Merchandise Inventory [47,400 x 98%] | $46,452 | |
Accounts Payable-Papoose Creek Co. | $46,452 | ||
[To record purchase of merchandise on account] | |||
Nov. 6 | Accounts Payable-Moonlight Co. [11,900 x 98%] | $11,662 | |
Merchandise Inventory | $11,662 | ||
[To record purchase returns] | |||
Nov. 8 | Accounts Receivable-Quinn Co. | $16,430 | |
Sales | $16,430 | ||
[To record sales on account] | |||
Nov. 8 | Cost of Goods Sold | $10,090 | |
Merchandise Inventory | $10,090 | ||
[To record cost of goods sold] | |||
Nov. 13 | Accounts Payable-Moonlight Co. [61,054-11,662 returns] | $49,392 | |
Cash | $49,392 | ||
[To record cash paid for accounts payable] | |||
Nov. 14-sale | Cash | $238,360 | |
Sales | $238,360 | ||
[To record cash sales] | |||
Nov. 14-cost | Cost of Goods Sold | $140,040 | |
Merchandise Inventory | $140,040 | ||
[To record cost of goods sold] | |||
Nov. 15 | Accounts Payable-Papoose Creek Co. | $46,452 | |
Cash | $46,452 | ||
[To record payment for accounts payable] | |||
Nov. 23 | Cash | $16,430 | |
Accounts Receivable-Quinn Co. | $16,430 | ||
[To record collections from customers] | |||
Nov. 24-sale | Accounts Receivable-Rabel Co. | $51,400 | |
Sales | $51,400 | ||
[To records sales on account] | |||
Nov. 24-cost | Cost of Goods Sold | $36,370 | |
Merchandise Inventory | $36,370 | ||
[To record cost of goods sold] | |||
Nov. 28 | Credit Card Expense | $3,360 | |
Cash | $3,360 | ||
[To record credit card expense] | |||
Nov. 30-refund | Customers Refunds Payable | $6,530 | |
Cash | $6,530 | ||
[To record customer refund payable] | |||
Nov. 30-cost | Merchandise Inventory | $3,240 | |
Estimated Returns Inventory | $3,240 | ||
[To record cost of sales returns] |
Answer all. Sales-Related and Purchase-Related Transactions Using Perpetual Inventory System The following were selected from among...
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