2 Sold merchandise to Creek Co. for $950 under credit terms of 2/10, n/60, FOB shipping point,...
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2 | Sold merchandise to Creek Co. for $950 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $550. | |||
3 | Paid $140 cash for freight charges on the purchase of July 1. | |||
8 | Sold merchandise that had cost $1,900 for $2,300 cash. | |||
9 | Purchased merchandise from Leight Co. for $2,400 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. | |||
11 | Returned $400 of merchandise purchased on July 9 from Leight Co. and debited its account payable for that amount. | |||
12 | Received the balance due from Creek Co. for the invoice dated July 2, net of the discount. | |||
16 | Paid the balance due to Boden Company within the discount period. | |||
19 | Sold merchandise that cost $1,000 to Art Co. for $1,500 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. | |||
21 | Gave a price reduction (allowance) of $250 to Art Co. for merchandise sold on July 19 and credited Art's accounts receivable for that amount. | |||
24 | Paid Leight Co. the balance due, net of discount. | |||
30 | Received the balance due from Art Co. for the invoice dated July 19, net of discount. | |||
31 | Sold merchandise that cost $5,400 to Creek Co. for $7,500 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31. |
Prepare journal entries to record the following merchandising transactions of Lowe’s, which uses the perpetual inventory system and the gross method. Hint: It will help to identify each receivable and payable; for example, record the purchase on August 1 in Accounts Payable—Aron.
Aug. | 1 | Purchased merchandise from Aron Company for $10,000 under credit terms of 1/10, n/30, FOB destination, invoice dated August 1. | ||
5 | Sold merchandise to Baird Corp. for $7,000 under credit terms of 2/10, n/60, FOB destination, invoice dated August 5. The merchandise had cost $5,000. | |||
8 | Purchased merchandise from Waters Corporation for $9,000 under credit terms of 1/10, n/45, FOB shipping point, invoice dated August 8. | |||
9 | Paid $120 cash for shipping charges related to the August 5 sale to Baird Corp. | |||
10 | Baird returned merchandise from the August 5 sale that had cost Lowe’s $500 and was sold for $1,000. The merchandise was restored to inventory. | |||
12 | After negotiations with Waters Corporation concerning problems with the purchases on August 8, Lowe’s received a price reduction from Waters of $900 off the $9,000 of goods purchased. Lowe's debited accounts payable for $900. | |||
14 | At Aron’s request, Lowe’s paid $190 cash for freight charges on the August 1 purchase, reducing the amount owed (accounts payable) to Aron. | |||
15 | Received balance due from Baird Corp. for the August 5 sale less the return on August 10. | |||
18 | Paid the amount due Waters Corporation for the August 8 purchase less the price allowance from August 12. | |||
19 | Sold merchandise to Tux Co. for $6,000 under credit terms of n/10, FOB shipping point, invoice dated August 19. The merchandise had cost $3,000. | |||
22 | Tux requested a price reduction on the August 19 sale because the merchandise did not meet specifications. Lowe’s gave a price reduction (allowance) of $1,000 to Tux, and credited Tux's accounts receivable for that amount. | |||
29 | Received Tux’s cash payment for the amount due from the August 19 sale less the price allowance from August 22. | |||
30 | Paid Aron Company the amount due from the August 1 purchase. |
Related Book For
Intermediate Accounting
ISBN: 978-1118742976
16th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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