Question

4 Journalize the following transactions assuming the perpetual inventory system: Sold merchandise on account for $3,750 with terms n/30. The cost of the merchandise sold was $2,000. Issued credit memo for $1,050 for merchandise returned from sale on July 3. The cost of the merchandise returned was $610. Received check for the amount due for sale on July 3 less return on July 5. Sold merchandise for $7,000 plus 6% sales tax to cash customers. The cost of the merchandise sold was $3,830. July 3 5 12 17

Answer 1

14) Journal entry

Date	account and explanation	Debit	Credit
July 3	Account receivable	3750
	Sales revenue		3750
	(To record sales)
	Cost of goods sold	2000
	Inventory		2000
	(To record cost of goods sold)
July 5	Sales return and allowance	1050
	Account receivable		1050
	(To record sales return)
	Inventory	610
	cost of goods sold		610
	(To record cost of goods returned)
July 12	Cash (3750-1050)	2700
	Account receivable		2700
	(To record collection)
July 17	Account receivable	7420
	Sales revenue		7000
	Sales tax payable		420
	(To record sales)
	Cost of goods sold	3830
	Inventory		3830
	(To record cost of goods sold)

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