Question

On July 1, Duffs Beer Distributor had an inventory of 60 cases of beer at a cost of $21 each The company uses a perpetual inventory system. During July, the following transaction:s occurred July 6 Purchased 75 cases at $20 each from Iron City Brewers, terms 2/10, n/30 July 9 Paid freight of $75 on the cases purchased from Iron City Brewers July 10 Returned 2 cases to Iron City Brewers for $40 credit because they did not meet specifications. They had a "skunky" smell July 11 Paid Iron City Brewers what was owed from the July 6th purchase July 12 Sold 41 cases costing $21 each for $34 each to the Drunken Clam, terms 2/10,n/30 July 14 Granted credit of $34 to the Drunken Clam for the return of one case that was not ordered July 21 Received payment in full from the Drunken Clam Prepare journal entries IN GOOD FORM for the July transactions. Include Sales and cost of oods sold entries if applicable Date Credit Account Debit

Answer 1

Date	Account	Debit	Credit
July, 6	Inventory	1500
	Accounts Payable		1500
	(To record purchase of cases)
July, 9	Inventory	75
	Accounts Payable		75
	(To record freight paid)
July, 10	Accoutns Payable	80
	Inventory		80
	(To record return of inventory)
July, 11	Accounts Payable	1420
	Discount		28.4
	Cash		1391.6
	(To record payment made)
July, 12	Accounts Receivale	1394
	Sales		1394
	(To record sales)
	Cost of goods sold	861
	Inventory		861
	(To record cost of sales)
July, 14	Sales return and allowances	34
	Accounts Receivable		34
	(To record grant of credit)
July, 21	Cash	1332.8
	Discount	27.2
	Accounts Receivable		1360
	(To record receipt of payment)