Question

On June 10, Kingbird Company purchased $8,200 of merchandise from Blossom Company, on account, terms 4/10, 30 Kingbird pays the freight costs of $410 on June 11. Goods totaling $400 are returned to Blossom for credit on June 12. On June 19,Kingbird Company pays Blossom Company in full, less the purchase discount. Both companies use a perpetual inventory system Prepare separate entries for each transaction on the books of Kingbird Company f no entry is required, select "No Entry" for the account titles and enter O for the amounts Credit account titles are automatically indented when amount is entered. Do not indent manually Record journal entries in the order presented in the problem.) Account Titles and Explanation Date Debit Credit

Answer 1

The journal entries are prepared using perpetual inventory system, for periodic inventory system replace Inventory with purchases or return out wards

If KIng bird purchases from Blossom then it is sales for Blossom, as the cost price is not mentioned in the question only the sales entry is shown below. The entry required for cost transfer is to Debit Cost of goods sold and credit inventory with cost amount

Date	Account Title & explanation	Debit $	Credit $
June 10	Inventory	3,300.00
	Accounts payable		3,300.00
	To record purchases of inventory
June 10	Accounts payable	210.00
	Inventory		210.00
	To record goods returned to supplier
June 10	King bird Company	8,200
	Sales		8,200
	To record sales to King Bird Company