Question

Presented below are transactions related to Bogner Company.

1. On December 3, Bogner Company sold $570,000 of merchandise on account to Maris Co., terms 2/10, n/30, FOB shipping point. The cost of the merchandise sold was $350,000.

2. On December 8, Maris Co. was granted an allowance of $20,000 for merchandise purchased on December 3.

3. On December 13, Bogner Company received the balance due from Maris co.

Prepare the journal entries to record these transactions on the books of Bogner Company using a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts.) No. Date Account Titles and Explanation Debat (To record credit cale) (To record cost of merchandise sold) 3. Dec. 13

Answer 1

1). Recording of journal entries are as follows:-

Credit Debit 5,70,000.00 $ Date Account Titles Dec-03 Account Receivable Sales (To record credit Sales) $ 5,70,000.00 $ 3,50,000.00 Dec-03 Cost of goods sold Merchandise Inventory (To record cost of merchandise sold) $ 3,50,000.00 $ 20,000.00 Dec-08 Sales returns and allowances Account Receivables $ 20,000.00 Dec-13 Cash Sales Discount ($550,000 * 2%) Account Receivable ($570,000 - $20,000) $ $ 5,39,000.00 11,000.00 $ 5,50,000.00

2). Recording the receiving of balance due on Jan 02.

Credit Date Account Titles Jan-02 Cash Account Receivable ($570,000 - $20,000) Debit 5,50,000.00 $ $ 5,50,000.00