Question

Nothing but FUN has the following transactions in October October 6 Purchases 10 units of GameBoy for $100 each, terms 2/10, n/60. October 7 Pays $200 to Sure Shipping for freight charges associated with the October 6 purchase October 10 Returns two units of GameBoy that were defective. October 14 Pays the full amount due for the purchase of 10/6 October 20 Returns three units of GameBoy that were defective October 23 Sells four units of GameBoy for $200 each to customers on account

Answer 1

Journal Entries:

Date	Account Titles and Explanations	Debit	Credit
Oct. 6	Merchandise Inventory (10 units * $100 per unit)	$1,000
	Accounts Payable - GameBoy		$1,000
	(To record the purchase of merchandise inventory on account)
Oct. 7	Freight Expenses	$200
	Cash		$200
	(To record the payment of amount for the purchase made on account)
Oct. 10	Accounts Payable - GameBoy	$200
	Merchandise Inventory (2 units * $100 per unit)		$200
	(To record 2 units are returned)
Oct. 14	Accounts Payable - GameBoy ($1,000 - $200)	$800
	Cash		$200
	(To record the full payment to GameBoy on cash)
Oct. 20	Accounts Payable - GameBoy ($1,000 - $300)	$700
	Cash		$700
	(To record the full payment to GameBoy on cash)
Oct. 23	Accounts Receivable (4 units * $200)	$800
	Sales Revenue		$800
	(To record the sales made on account on they.