Discount Wines, Inc., had a beginning inventory balance of $85,450 and engaged in the following transactions during the month of October:
October 2 Purchased $15,000 of merchandise inventory on account from Joe’s Winery with terms 2/10, n/30 and FOB destination. Freight costs for this purchase were $750.
October 5 Returned $100 of damaged merchandise to Joe’s
October 6 Sold $18,000 of merchandise to Tasty Catering Service on account, terms 2/15, n/30 and FOB shipping point. Freight costs were $155. The cost of the inventory sold was $10,500.
October 10 Paid the amount owed to Joe’s
October 10 Granted Tasty an allowance on the October 6 sale of $200 for some soured wine
October 23 Received total payment owed from Tasty
October 29 Paid sales salaries of $1,500
October 31 Paid the rent on the warehouse of $1,450
Enter each of the transactions for Discount Wines, Inc., into the accounting equation, assuming it uses a perpetual inventory system.

  • CreatedSeptember 01, 2014
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