Question

World Imports uses the perpetual system in accounting for merchandise inventory and had the following transactions during the month of October. Prepare entries to record these transactions assuming that World Imports records invoices
(a) At gross amounts
(b) At net amounts.
Oct. 2 Purchased merchandise at a $5,600 price, invoice dated October 2, terms 1/10, n/30.
10 Received a $900 credit memorandum (at full invoice price) for the return of merchandise that it purchased on October 2.
17 Purchased merchandise at a $5,950 price, invoice dated October 16, terms 2/10, n/30.
26 Paid for the merchandise purchased on October 17, less the discount.
31 Paid for the merchandise purchased on October 2. Payment was delayed because the invoice was mistakenly filed for payment today. This error caused the discount to be lost.


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  • CreatedMarch 18, 2015
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