Question

On June 10,Crane Company purchased $ 6,100 of merchandise from Sheridan Company, terms 2/10, n/30. Crane Company pays the freight costs of 360 on June 11. Goods totaling $400 are returned to Sheridan Company for credit on June 12.On June 19, Crane Company pays Sheridan Company in full, less the purchase discount. Both companies use a perpetual inventory system Prepare separate entries for each transaction on the books of Crane Company.( no entry is required, select "No Entry' for the account titles and enter for the armounts Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem) Date Account Titles and Explanatiorn Debit Credit

Answer 1

Journal Entries in the books of Sheridan Company
Sr. No.	Date	Account Title and explanation	Debit	Credit
1	June, 10	Mercahndise	$6,100
		To Account Payable (Sheridan Company)		$6,100
		Mercahndise	$360
2	June, 11	To Cash		$360
3	June, 12	Account Payable (Sheridan Company)	$400
		To Merchandise		$400
		Account Payable (Sheridan Company)	$5,700
4	June, 19	To Cash ($ 5,700 X 98%)		$5,586
		To discount on purhcase ($ 5,700 X 2%)		$114
Journal Entries in the books of Crane
Sr. No.	Date	Account Title and explanation	Debit	Credit
1	June, 10	Account Receivable (Sheridan co,)	$6,100
		To Sales		$6,100
		Cost of Goods sold	$2,000
2	June, 10	To Merchandise		$2,000
		Sales Return	$400.00
3	June, 12	To Account Receivable (Sheridan co,)		$400.00
4	June, 12	Merchandise	$200
		To Cost of Goods Sold		$200
5	June, 19	Cash	$5,586
		Discount on Sales	$114
		To Account Receivable (Sheridan co,)		$5,700