Question

Exercise 5-02 a-b (Part Level Submission) (Video) Information related to Culver Co. is presented below. 1. On April 5, purchased merchandise on account from Sage Hill Company for $41,300, terms 2/10, net/30, FOB shipping point. 2. On April 6, paid freight costs of $900 on merchandise purchased from Sage Hill. 3. On April 7, purchased equipment on account for $40,200. 4. On April 8, returned damaged merchandise to Sage Hill Company and was granted a $6,100 credit for returned merchandise. 5. On April 15, paid the amount due to Sage Hill Company in full. (a) Prepare the journal entries to record these transactions on the books of Culver Co. under a perpetual inventory system. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit No. 1. Click if you would like to show Work for this question: Open Show Work

Answer 1

Date	Accounts Titles and explanation	Debit	Credit
April 5	Inventory	$41,300
	...Accounts Payable		$41,300
	(To record inventory purchased)
April 6	Inventory	$900
	...Cash		$900
	(To record freight paid)
April 7	Equipment	$40,200
	...Accounts Payable		$40,200
	(To record equipment purchased)
April 8	Accounts Payable	$6,100
	...Inventory		$6,100
	(To record goods returned)
April 15	Accounts Payable (41,300 - $6,100)	$35,200
	...cash		$34,496
	...Inventory ($35,200 * 2%)		$704
	(To record the full payment paid)