Question

Prepare journal entries to record the following merchandising transactions of Cabela’s, which uses the perpetual inventory system and the gross method.

Journal entry worksheet in second pic goes 1 through 17

Prepare journal entries to record the following merchandising transactions of Cabela's, which uses the perpetual inventory system and the gross method. Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Boden. July 1 Purchased merchandise from Boden Company for $6,300 under credit terms of 2/15, n/30, TOB shipping point, invoice dated July 1. 2 Sold merchandise to Creek Co. for $950 under credit terms of 2/10, n/60, POB shipping point, invoice dated July 2. The merchandise had cost $525. 3 Paid $110 cash for freight charges on the purchase of July 1. 8 Sold merchandise that had cont $1,600 for $2,000 cash. 9 Purchased merchandise from Leight Co. for $2,600 under credit terms of 2/15, n/60, ron destination, invoice dated July 9. 11 Returned $600 of merchandise purchased on July 9 from Leight Co. and debited its account payable for that amount. 12 Received the balance due from Creek Co. for the invoice dated July 2, not of the discount. 16 Paid the balance due to Boden Company within the discount period. 19 Sold merchandise that cost $1,000 to Art Co. for $1,500 under credit terms of 2/15, 1/60, POB shipping point, Invoice dated July 19. 21 Gave a price reduction allowance) of $250 to Art Co. for merchandise sold on July 19 and credited Art's accounts receivable for that amount. 24 Paid Leight Co. the balance due, net of discount. 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount 31 sold merchandise that cost 65,100 to Creek Co. for $7,200 under credit terms of 2/10, 1/60, POB shipping point, Invoice dated July 31.

Answer 1

July 9 $2,600 Merchandise Inventory Accounts Payable - leight (To second merchandise purchased) $2,600 July 1 $600 Accounts Payable - light Merchandise Inventory (To record merchandise returned) $600 July 12 Cash $931 sales discounts $ 19 Accounts Receivable - Creek (To record due balance received) $950 July 16 $6,300 accounts payable - Boden Merchandise Inventory cash (To record due balance paid) $ 126 $ 6,174 July 19 $1,500 Accounts Receivable - Art Sales (To record sales) $ 1,500 July 19 $1,000 Cost of goods sold Merchandise Inventory To record cost of goods sold) $1,000

July 21 sales returns and allowances $250 Accounts Receivable - Art (to second allowance on goods sowel 250 $2,000 July 24 Accounts Payable - reight Merchandise Inventory Cash (To secosa due balance paid) 1$ 4o $1,960 July 30 cash $ 1,225 sales discounte $25 Accounts Receivable- Art (To recond due balance received) $1,250 - $ 7,200 Julysl Accounts Receivable - Creek sales 1 (To record sales) $7,200 July 31 Cost of goods sold $5,100 Merchandise Inventory (To second cost of goods sold) $ $100

Calculation: July 12. sales discounts a $950x 2% discount = $ 19 Cash – $950 - $19 discount = $ 931 16. Merciandise Inventory = $6,300 x 2% discount = $126 Cash = $6,300 - $136 discount = $6,174 July 24: Merchandise Inventory = [($2,600 - $600 returned merchandise Jx 2% discount] : $2,000 x 2% discount = $40 Cash = $2,000 - $40 discount 2 $1,960 July 30: sales discounts = (sales - sales Allowance) & Discount E ($ 1,500 - $250) x 2% a $1,250 x 2% a $25 Cash & $1,250 – $25 discount z $ 1,225