GL0401 - Based on Problem 4-1A LO P1, P2

Prepare journal entries to record the following merchandising transactions of Brown'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 PayableParker.)

Jul.1Purchased merchandise from Parker Company for $6,200 under credit terms of 1/15, n/30, FOB shipping point, invoice dated July 1.Jul.2Sold merchandise to Griffin Co. for $1,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $600.Jul.3Paid $165 cash for freight charges on the purchase of July 1.Jul.8Sold merchandise that had cost $1,100 for $1,900 cash.Jul.9Purchased merchandise from Wilson Co. for $2,300 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9.Jul.11Returned $500 of merchandise purchased on July 9 from Wilson Co. and debited its account payable for that amount.Jul.12Received the balance due from Griffin Co. for the invoice dated July 2, net of the discount.Jul.16Paid the balance due to Parker Company within the discount period.Jul.19Sold merchandise that cost $1,000 to Mannion Co. for $1,400 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19.Jul.21Gave a price reduction (allowance) of $300 to Mannion Co. for merchandise sold on July 19 and credited Mannion's accounts receivable for that amount.Jul.24Paid Wilson Co. the balance due, net of discount.Jul.30Received the balance due from Mannion Co. for the invoice dated July 19, net of discount.Jul.31Sold merchandise that cost $4,300 to Griffin Co. for $7,200 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.