Question

MLEM 3.Perpetual System 1 Belton Bicycle Store nad an inventory of 20 ten speed bicycles at a cost of $200 eaching Actober, the following transactions occurred Oct. 4 Purchased 30 bicycles at a cost of $200 each from Kuhn Bicycle Company, terms 22/10, 1/30 6 Sold 18 bicycles to Team America for $300 each, terms 2/10, 1/30. 7 Received credit from Kuhn Bicycle Company for the return of 2 defective bicycles 12 issued a credit memo to Team America for the return of a defective bicycle 13 Paid Kuhn Bicycle Company in full, less discount. 15 Received payment in full from Team America. GENERAL JOURNAL DATE ACCOUNT TITLE REF. DEBIT CREDIT

Answer 1

Solution:

Journal Entries - Belton Bicycle Store
Date	Particulars	Debit	Credit
4-Oct	Inventory Dr	$6,000.00
	To Accounts payable - Kuhn Bicycle Company		$6,000.00
	(To record purchase of inventory on account)
6-Oct	Accounts receivables - Team America Dr	$5,400.00
	To Sales revenue		$5,400.00
	(To record sales revenue)
6-Oct	Cost of goods sold Dr	$3,600.00
	To Inventory		$3,600.00
	(To record cost of goods sold)
7-Oct	Accounts payable - Kuhn Bicycle Company Dr	$400.00
	To Inventory		$400.00
	(To record purchase returns)
12-Oct	Sales returns and allowances Dr	$300.00
	To Accounts receivables - Team America		$300.00
	(To record sales returns)
12-Oct	Inventory Dr	$200.00
	To Cost of goods sold		$200.00
	(Being goods returned taken into inventory)
13-Oct	Accounts payable - Kuhn Bicycle Company Dr	$5,600.00
	To Inventory		$112.00
	To Cash		$5,488.00
	(To record payment to supplier)
15-Oct	Cash Dr	$4,998.00
	Sales discount Dr	$102.00
	To Accounts receivables - Team America		$5,100.00
	(To record collection from customer)