Question

Prepare journal entries to record each of the following transactions of a merchandising company. The company uses a perpetual inventory system and the gross method. Nov. 5 Purchased 1,200 units of product at a cost of $10 per unit. Terms of the sale are 4/10, n/60; the invoice is dated November 5. Nov. 7 Returned 35 defective units from the November 5 purchase and received full credit. Nov. 15 Paid the amount due from the November 5 purchase, less the return on November 7. Answer is complete but not entirely correct. General Journal Credit No 1 Date Nov 05 Debit 12,000 Merchandise inventory Accounts payable 12,000 Nov 07 350 Accounts payable Merchandise inventory 350 Nov 15 11,650 Accounts payable Merchandise inventory Cash 233 11,417

Answer 1

No.	Date	General Journal	Debit	Credit
3	Nov 15	Accounts payable	$11,650
		Merchandise inventory($11,650 * 4%)		$466
		Cash		$11,184