Question

Littleton Books has the following transactions during May.

May 2 Purchases books on account from Readers Wholesale for $2,600, terms 1 / 10, n / 30.

May 3 Pays cash for freight costs of $130 on books purchased from Readers.

May 5 Returns books with a cost of $200 to Readers because part of the order is incorrect.

May 10 Pays the full amount due to Readers.

May 30 Sells all books purchased on May 2 (less those returned on May 5) for $3,300 on account.

2. Record the period-end adjustment to cost of goods sold on May 31 , assuming the company has no beginning or ending inventory. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

	General Journal	Debit	Credit
May 31	Cost of goods sold	2506
	Purchase returns	200
	Purchase discounts	24		=(2600-200)*1%
	Purchases		2600
	Freight-in		130