Question

(1) On December 3 Kale Company sold $500,000 of merchandise to Thomson Co., terms 1/10, n/30. The cost of the merchandise sold was $320,000. (2) On December 8 Thomson Co. was granted an allowance of $20,000 for merchandise purchased on December 3 (3) On December 13 Kale Company received the balance due from Thomson Co. Prepare the journal entries to record these transactions on the books of Kale Company. Kale uses a perpetual inventory system. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Date Account Titles and Explanation (1) Dec. 3 Debit Credit (To record credt sale) (To record cost of good sold) (2) Dec. 8 (3) Dec. 13

Answer 1

Answer

>requirement A

Date	Accounts Title	Debit	Credit
(1) Dec 3	Accounts receivables	$500,000
	Sales Revenue		$500,000
	(to record credit sale)
	Cost of Goods Sold	$320,000
	Merchandise Inventory		$320,000
	(to record cost of goods sold)
(2) Dec 8	Sales Return & Allowances	$20,000
	Accounts receivables		$20,000
	(to record allowances)
(3) Dec 13	Cash	$475,200
	Sales Discounts [480000 x 1%]	$4,800
	Accounts receivables [500000 - 20000]		$480,000
	(Cash received within discount term)