Bridgeport Warehouse distributes suitcases to retail stores and extends credit terms of n/30 to all of its customers. Bridgeport Warehouse uses a periodic inventory system the earnings approach. At the end of June its inventory consisted of 41 suitcases purchased at $36 each. During the month of July, the following merchandising transactions occurred: July 1 Purchased 50 suitcases on account for $36 each from Trunk Manufacturers, terms n/30, FOB destination. 2 The correct company paid $155 freight on the July 1 purchase. 4 Received $180 credit for five suitcases returned to Trunk Manufacturers because they were damaged. 10 Sold 45 suitcases that cost $36 each to Satchel World for $70 each on account. 12 Issued a $350 credit for five suitcases returned by Satchel World because they were the wrong colour. The suitcases were returned to inventory. 15 Purchased 60 additional suitcases from Trunk Manufacturers for $33.50 each, terms n/30, FOB shipping point. 18 Paid $150 freight to AA Trucking Company for merchandise purchased from Trunk Manufacturers. 21 Sold 54 suitcases that cost $36 each to Fly-By-Night for $70 each on account. 23 Gave Fly-By-Night a $140 credit for two returned suitcases. The suitcases had been damaged and were sent to the recyclers. 30 Paid Trunk Manufacturers for the July 1 purchase. 31 Received balance owing from Satchel World.
Record the July transactions for Bridgeport Warehouse. Assume that Bridgeport uses the earnings approach.
Date | Account Titles | Debit | Credit |
Jul-01 | Purchase | $ 1,800 | |
Accounts payable | $ 1,800 | ||
(Purchase of inventory on account) | |||
Jul-02 | No entry | ||
Jul-04 | Accounts Payable | $ 180 | |
Purchase returns | $ 180 | ||
(Returned damaged inventory) | |||
Jul-10 | Accounts Receivable | $ 3,150 | |
Sales Revenue | $ 3,150 | ||
(Sold suitcases on account) | |||
Jul-12 | Sales Returns | $ 350 | |
Accounts Receivable | $ 350 | ||
(Goods returned by customer) | |||
Jul-15 | Purchase | $ 2,010 | |
Accounts payable | $ 2,010 | ||
(Purchase of inventory on account) | |||
Jul-18 | Freight in | $ 150 | |
Cash | $ 150 | ||
(Paid freight on purchase) | |||
Jul-21 | Accounts Receivable | $ 3,780 | |
Sales Revenue | $ 3,780 | ||
(Sold suitcases on account) | |||
Jul-23 | Sales Returns | $ 140 | |
Accounts Receivable | $ 140 | ||
(Goods returned by customer) | |||
Jul-30 | Accounts Payable | $ 1,620 | |
Cash | $ 1,620 | ||
(Paid Trunk manufactures net of return) | |||
Jul-31 | Cash | $ 2,800 | |
Accounts Receivable | $ 2,800 | ||
(Collected from Satchel world net of return) |
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