Question

The following selected transactions were completed by Betz Company during July of the current year. Betz Company uses the net method under a perpetual inventory system.

July	1	Purchased merchandise from Sabol Imports Co., $13,701, terms FOB destination, n/30.
	3	Purchased merchandise from Saxon Co., $8,950, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $225 was added to the invoice.
	5	Purchased merchandise from Schnee Co., $13,450, terms FOB destination, 2/10, n/30.
	6	Issued debit memo to Schnee Co. for merchandise with an invoice amount of $4,250 returned from purchase on July 5.
	13	Paid Saxon Co. for invoice of July 3.
	14	Paid Schnee Co. for invoice of July 5, less debit memo of July 6.
	19	Purchased merchandise from Southmont Co., $28,290, terms FOB shipping point, n/eom.
	19	Paid freight of $420 on July 19 purchase from Southmont Co.
	20	Purchased merchandise from Stevens Co., $20,200, terms FOB destination, 1/10, n/30.
	30	Paid Stevens Co. for invoice of July 20.
	31	Paid Sabol Imports Co. for invoice of July 1.
	31	Paid Southmont Co. for invoice of July 19.

Instructions The following selected transactions were completed by Betz Company during July of the current year. Betz Company uses the net method under a perpetual inventory system. July 1 Purchased merchandise from Sabol Imports Co., $13,701, terms FOB destination, n/30. Purchased merchandise from Saxon Co., $8,950, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $225 was added to the invoice. Purchased merchandise from Schnee Co., $13,450, terms FOB destination, 2/10, n/30. 5 Issued debit memo to Schnee Co. for merchandise with an invoice amount of $4,250 returned from purchase on July 5. Paid Saxon Co. for invoice of July 3. 13 14 Paid Schnee Co. for invoice of July 5, less debit memo of July 6. 19 Purchased merchandise from Southmont Co., $28,290, terms FOB shipping point, n/eom. Paid freight of $420 on July 19 purchase from Southmont Co. Purchased merchandise from Stevens Co., $20,200, terms FOB destination, 1/10, n/30. Paid Stevens Co. for invoice of July 20. Paid Sabol Imports Co. for invoice of July 1. Paid Southmont Co. for invoice of July 19. 30 31 31 Journalize the entries to record the transactions of Betz Company for July. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Betz Company
Journal entries
Date	Account	Debit	Credit	Assets	Liabilities	Equity	Calculation
1-Jul	Inventory	13,701		↑
	Accounts Payable-Sabol Imports Co.		13,701		↑
3-Jul	Inventory	8,996		↑			=8,950*(1-2%)+225
	Accounts Payable-Saxon Co.		8,996		↑
5-Jul	Inventory	13,181		↑			=13,450*(1-2%)
	Accounts Payable-Schnee Co.		13,181		↑
6-Jul	Accounts Payable-Schnee Co.	4,165		↓			=4,250*(1-2%)
	Inventory		4,165		↓
13-Jul	Accounts Payable-Saxon Co.	8,996		↓
	Cash		8,996		↓
14-Jul	Accounts Payable-Schnee Co.	9,016		↓			=13,181-4,165
	Cash		9,016		↓
19-Jul	Inventory	28,290		↑
	Accounts Payable-Southmont Co.		28,290		↑
19-Jul	Inventory	420		↑
	Cash		420		↓
20-Jul	Inventory	19,998		↑			=20,200*(1-1%)
	Accounts Payable-Stevens Co.		19,998		↑
30-Jul	Accounts Payable-Stevens Co.	19,998		↓
	Cash		19,998		↓
31-Jul	Accounts Payable-Sabol Imports Co.	13,701		↓
	Cash		13,701		↓
31-Jul	Accounts Payable-Southmont Co.	28,290		↓
	Cash		28,290		↓