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Prepare journal entries to record the following merchandising transactions of Blink Company, which applies the perpetual inventory system. (Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Boden.) Jul. 1 Purchased merchandise from Boden Company for $6,000 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. Jul.2 Sold merchandise to Creek Co. for $900 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $500. Jul. 3 Paid $125 cash for freight charges on the purchase of July 1. Jul. 8 Sold merchandise that had cost $1,300 for $1,700 cash. Jul. 9 Purchased merchandise from Leight Co. for $2,200 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. Jul. 11 Received a $200 credit memorandum from Leight Co. for the return of part of the merchandise purchased on July 9. Jul. 12 Received the balance due from Creek Co. for the invoice dated July 2, net of the discount. Jul. 16 Paid the balance due to Boden Company within the discount period. Jul. 19 Sold merchandise that cost $800 to Art Co. for $1,200 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. Jul. 21 Issued a $200 credit memorandum to Art Co. for an allowance on goods sold on July 19. Jul. 24 Paid Leight Co. the balance due after deducting the discount. Jul. 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount Jul. 31 Sold merchandise that cost $4,800 to Creek Co. for $7,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. Requirement General Journal General Ledger Trial Balance Schedule of Receivables Schedule of Payables Income Statement Impact on Income Journalize the merchandising transactions. The General Ledger, trial balance, and schedules of accounts receiva payable will be updated based on your entries. View transaction list Journal entry worksheet 2 3 1 4 5 6 7 8 17 > Jul. 1) Purchased merchandise from Boden Company for $6,000 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. Note: Enter debits before credits. Date Account Title Debit Credit Jul 01 Record entry Clear entry View general journal 1 Jul. 1) Purchased merchandise from Boden Company for $6,000 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. 2 Jul. 2) Sold merchandise to Creek Co. for $900 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. 3 Jul. 2) The cost of the merchandise sold to Creek Co. was $500. 4 Jul. 3) Paid $125 cash for freight charges on the purchase of July 1. 5 Jul. 8) Sold merchandise for $1,700 cash. 6 Jul. 8) The cost of the merchandise sold was $1,300. 7 Jul. 9) Purchased merchandise from Leight Co. for $2,200 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. 8 Jul. 11) Received a $200 credit memorandum from Leight Co. for the return of part of the merchandise purchased on July 9. 9 Jul. 12) Received the balance due from Creek Co. for the invoice dated July 2, net of the discount. 10 Jul. 16) Paid the balance due to Boden Company within the discount period. 11 Jul. 19) Sold merchandise to Art Co. for $1,200 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. 12 Jul. 19) The cost of the merchandise sold to Art Co. was $800. 13 Jul. 21) Issued a $200 credit memorandum to Art Co. for an allowance on goods sold on July 19. 14 Jul. 24) Paid Leight Co. the balance due after deducting the discount. 15 Jul. 30) Received the balance due from Art Co. for the invoice dated July 19, net of discount. 16 Jul. 31) Sold merchandise to Creek Co. for $7,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. 17 Jul. 31) The cost of the merchandise sold to Creek Co. was $4,800. General Ledger Account Cash Merchandise inventory Debit Credit No. Debit Credit No. Date Jun 30 Balance 25,000 Date Jun 30 Balance 5,000 Common Stock No. Date Debit Credit Balance 30,000 (General Journal Trial Balance > Blink Company Trial Balance July 31, 2015 Account Title Credit $ Debit 25,000 5,000 Cash Merchandise inventory Common Stock Total 30,000 30,000 $ 30,000 $ No input required Dates: Jul 01 to: Jul 31 $ 0 Blink Company Schedule of Accounts Receivable Accounts receivable - Art Accounts receivable - Boden Accounts receivable - Creek Accounts receivable - Leight 0 0 0 0 Total accounts receivable $ 0 No input required Dates: Jul 01 to: Jul 31 $ 0 Blink Company Schedule of Accounts Payable Accounts payable - Art Accounts payable - Boden Accounts payable - Creek Accounts payable - Leight 0 0 0 0 Total accounts payable $ 0 Prepare a multiple-step income statement through the calculation of gross profit. Blink Company Income Statement For the Month Ended July 31, 2015 $ 0 $ 0 0 0 0 0 $ 0 Impact on income Increase (decrease) to income July 1) Purchased merchandise from Boden Company for $6,000 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1. July 2) Sold merchandise to Creek Co. for $900 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. July 2) The cost of the merchandise sold to Creek Co. was $500. July 3) Paid $125 cash for freight charges on the purchase of July 1. July 8) Sold merchandise for $1,700 cash. July 8) The cost of the merchandise sold was $1,300. July 9) Purchased merchandise from Leight Co. for $2,200 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. July 11) Received a $200 credit memorandum from Leight Co. for the return of part of the merchandise purchased on July 9. July 12) Received the balance due from Creek Co. for the invoice dated July 2, net of the discount July 16) Paid the balance due to Boden Company within the discount period. July 19) Sold merchandise to Art Co. for $1,200 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. July 19) The cost of the merchandise sold to Art Co. was $800. July 21) Issued a $200 credit memorandum to Art Co. for an allowance on goods sold on July 19. July 24) Paid Leight Co. the balance due after deducting the discount July 30) Received the balance due from Art Co. for the invoice dated July 19, net of discount. July 31) Sold merchandise to Creek Co. for $7,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. July 31) The cost of the merchandise sold to Creek Co. was $4,800. Total gross profit $ 0

Answer 1

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you. Cabela BlinkCompany General. -rnal General Ledger: Date Account Debit Credit Accounts Date Debit Credit Balance Jul 1 $ 6,000 Accounts Payable 1 Merchandise Inventory Accounts Payable-Boden Purchased goods, terms 1/15, n/30. $ 6,000 9 11 $ 200 16 $ 6,000 24 $ 2,000 $ 6,000 $ 6,000 $ 2,200 $ 8,200 $ 8,000 $ 2,000 $ 2 $ 900 Accounts Receivable-Creek Sales Sold goods, terms 2/10, n/60. $ 900 Accounts Receivable 900 2 $ 900 12 19 $ 1,200 21 2 $ 500 Cost of Goods Sold Merchandise Inventory Record cost of the July 2 sale. $ $ 900 $ $ $ 200 $ $1,000 $ $ 1,200 1,000 $ 500 30 31 $ 7,000 7,000 3 $ 125 Merchandise Inventory Cash Paid freight on incoming goods. $ 125 Cash Beginning 3 8 $ 1,700 12 $ 882 16 $ 1,700 8 Cash Sales Sold goods for cash. $ 25,000 $ 125 $ 24,875 $ 26,575 $ 27,457 $ 5,940 $ 21,517 $ 1,960 $ 19,557 $ 20,537 $ 1,700 24 30 $ 980 8 $ 1,300 Cost of Goods Sold Merchandise Inventory Record cost of the July 8 sale. $ 1,300 Cost of Goods Sold 2 $ 500 8 $ 1,300 19 $ 800 31 $ 4,800 $ 500 $ 1,800 $ 2,600 $ 7,400 $ 2,200 9 Merchandise Inventory Accounts Payable-Leight Purchased goods, terms 2/15, n/60. $ 2,200 Merchandise Inventory 11 $ 200 Accounts Payable-Leight Merchandise Inventory Returned goods for credit. $ 200 Beginning 1 $ 6,000 2 3 $ 125 8 9 $ 2,200 11 $ 5,000 $ 11,000 $ 500 $ 10,500 $ 10,625 $ 1,300 $ 9,325 $ 11,525 $ 200 $ 11,325 $ 60 $ 11,265 $ 800 $ 10,465 $ 40 $ 10,425 $ 4,800 $ 5,625 12 882 $ $ 18 16 Cash Sales Discounts ($900*2%) Accounts Receivable-Creek Received payment within discount period. $ 900 19 24 31

16 $ 6,000 Sales 2 Accounts Payable-Boden Merchandise Inventory ($6,000*1%) Cash Paid for goods within discount period. $ 60 $ 5,940 8 $ 900 $ 900 $ 1,700 $ 2,600 $ 1,200 $ 3,800 $ 7,000 $ 10,800 19 31 $ 1,200 19 Accounts Receivable-Art Sales Sold goods, terms 2/15, n/60. $ 1,200 Sales discounts 18 18 12 $ 30 $ $ $ 20 38 $ 800 Sales Returns and Allowances 21 $ 200 $ 200 19 Cost of Goods Sold Merchandise Inventory Record cost of July 19 sale. $ 800 Common Stock Beginning $ 30,000 $ 30,000 $ 200 Trial Balance: 21 Sales Returns and Allowances Accounts Receivable-Art Issued credit for allowance on goods sold. $ 200 Credit Debit $ 20,537 $ 7,000 $ 5,625 $ 2,000 40 24 Accounts Payable-Leight Merchandise Inventory ($2,000*2%) Cash Paid for goods within discount period. $ $ Cash Accounts Receivable Merchandise Inventory Common Stock Sales Sales discounts Sales Returns and Allowances Cost of Goods Sold $ 30,000 $ 10,800 1,960 38 $ $ $ 200 980 7,400 $ $ 20 30 Cash Sales Discounts ($1,000*2%) Accounts Receivable-Art Received payment within discount period. $ 1,000 Total $ 40,800 $ 40,800 Schedule of Receivables: $ 7,000 31 Accounts Receivable-Creek Sales Sold goods, terms 2/10, n/60. $ 7,000 Accounts Receivable-Art Accounts Receivable-Creek Total $ $ 7,000 $ 7,000 $ 4,800 31 Cost of Goods Sold Merchandise Inventory Record cost of July 31 sale. $ 4,800 Schedule of Payables: Accounts Payable-Boden Accounts Payable-Leight Total $ $ $ Income Statement: $ 10,800 Sales Less: Sales Return and allowance Sales Discounts Net Sales Less: Cost of goods sold Gross Margin $ 200 $ 38 $ (238) $ 10,562 $ (7,400) $ 3,162

Impact Increase(Decrease) $ $ $ S Jul 2 Jul 2 Jul 8 Jul 8 Jul 12 Jul 19 Jul 19 Jul 21 Jul 30 Jul 31 Jul 31 Increase Decrease Increase Decrease Decrease Increase Decrease Decrease Decrease Increase Decrease 900 (500) 1,700 (1,300) (18) 1,200 (800) $ S $ S (200) $ S (20) 7,000 (4,800) $ Date not mentioned, have no impact