Question

Check my work Required information The following information applies to the questions displayed below.) Part 1 of 2 0.83 points James Company began the month of October with inventory of $20,000. The following inventory transactions occurred during the month: eBook a. The company purchased merchandise on account for $29,500 on October 12. Terms of the purchase were 2/10, n/30. James uses the net method to record purchases. The merchandise was shipped f.o.b. shipping point and freight charges of $550 were paid in cash. b. On October 31, James paid for the merchandise purchased on October 12. c. During October merchandise costing $18,750 was sold on account for $29,000. d. It was determined that inventory on hand at the end of October cost $30,710. References Required: 1. Assuming that the James Company uses a perpetual inventory system, prepare journal entries for the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list

Answer 1

James Company Journal Enteries Debit in $ Credit in $ Trans. Particulars Inventory a/c To Accounts Payable Dr. 28910 а. 28910 (Inventory on account)29500 x 0.98 b. Freight a/c Dr. 550 To Cash 550 |(Freight paid) Accounts Payable a/c Interest Expense a/c Dr. 28910 C. Dr. 590 To Cash 29500 (Creditors paid) Accounts Receivable a/c d. Dr. 29000 To Sales Revenue 29000 (Sales on account) Cost of goods sold a/c Dr. 18750 To Inventory 18750 (To record cost of goods sold) Cost of goods sold 20000 Beginning Inventory Net Purchases 28910 Freight in Cost of goods available Less:Ending Inventory 550 49460 30710 Cost of goods sold 18750