GL0401 (Algo) - Based on Problem 4-1A LO P1, P2 Prepare journal entries to record the following merchandising transactions of Gonzalez'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 July 1 in Accounts Payable King.) July 1 Purchased merchandise from King Company for $6,800 under credit terms of 1/15, 1/30, FOB shipping point, Invoice dated July 1. July 2 Sold merchandise to wright Company for $1,300 under credit terms of 2/10, 1/60, For shipping point, invoice dated July 2. The merchandise had cost 5780. July 3 Paid $285 cash for freight charges on the purchase of July 1. July Sold merchandise that had cost $1,500 for $2,500 cash July 9 Purchased merchandise from Lee Company for $2,600 under credit terms of 2/15, 1/60, FOB destination, Invoice dated July 9. July 11 Returned $500 of merchandise purchased on July 9 from Lee Company and debited its account payable for that amount. July 12 Received the balance due from Wright Company for the invoice dated July 2, net of the discount. July 16 Paid the balance due to King Company within the discount period. July 19 Sold merchandise that cost $1,400 to Griffin Company for $2,000 under credit terms of 2/15, 1/60, FOB shipping point, invoice dated July 19. July 21 Gave a price reduction (allowance) of 5400 to Griffin Company for merchandise sold on July 19 and credited Griffin's accounts receivable for that amount July 24 Paid Lee Company the balance due, net of discount July 30 Received the balance due from Griffin Company for the invoice dated July 19, net of discount. July 31 Sold merchandise that cost $4,700 to right Company for $7,000 under credit terms of 2/10, 1/60, FOB shipping point, Invoice dated July 31. General Journal Requirement General Ledger Trial Balance Schedule of Receivables Schedule of Payables Income Statement Impact on Income For each transaction, indicate the impact each item had on income and the dollar amount of the change in income, if any. Input decreases to net income as minus sign. Upon completion, compare the gross profit with the amount reported on the partial income statement. Impact on income Increase (decrease) to income July 1) Purchased merchandise from King Company for 56,800 under credit terms of 1/15, 1/30, FOB shipping point, invoice dated July 1 July 2) Sold merchandise to Wright Company for $1,300 under credit terms of 2/10, 1/60, FOB shipping point, invoice dated July 2 July 2) The cost of the merchandise sold to Wright Company was $780 July 3) Paid $285 cash for freight charges on the purchase of July 1 July 8) Sold merchandise for $2,500 cash. July 8) The cost of the merchandise sold was 51,500. July 9) Purchased merchandise from Lee Company for $2,600 under credit terms of 2/15, 160, FOB destination, Invoice dated July 9 July 11) Received a $500 credit memorandum from Lee Company for the return of part of the merchandise purchased on July 9 July 8) The cost of the merchandise sold was $1,500. July 9) Purchased merchandise from Lee Company for $2,600 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. July 11) Received a $500 credit memorandum from Lee Company for the return of part of the merchandise purchased on July 9. July 12) Received the balance due from Wright Company for the invoice dated July 2, net of the discount. July 16) Paid the balance due to King Company within the discount period. July 19) Sold merchandise to Griffin Company for $2,000 under credit terms of 2/15, 1/60, FOB shipping point, invoice dated July 19. July 19) The cost of the merchandise sold to Griffin Company was $1,400. July 21) Issued a $400 credit memorandum to Griffin Company for an allowance on goods sold on July 19. July 24) Paid Lee Company the balance due, net of discount July 30) Received the balance due from Griffin Company for the invoice dated July 19, net of discount July 31) Sold merchandise to Wright Company for $7,800 under credit terms of 2/10,n/60, FOB shipping point, invoice dated July 31 July 31) The cost of the merchandise sold to Wright Company was 54,700. Total gross profit