Homework: Merchandising Operations Exercises Assignment i ! Required information [The following information applies to the questions displayed below.] Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Allied (seller) products. 2 points May 3 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000 ). May 5 Allied sold 1,000 of the units in inventory for $14 per unit (invoice total: $14,000 ) to Macy Company under credit terms 2/10,n/60. The goods cost Allied $10,000. May 7 Macy returns 100 units because they did not fit the customer's needs (invoice amount: \$1,400). Allied restores the units, which cost $1,000, to its inventory. May 8 Macy discovers that 100 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for \$600 to compensate for the damage. May 15 Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount. Prepare journal entries to record the following transactions for Allied assuming it uses a perpetual inventory system and the gross method. Journal entry worksheet 456 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000 ). Note: Enter debits before credits. Journal entry worksheet Allied sold 1,000 of the units in inventory for $14 per unit (invoice total: $14,000 ) to Macy Company under credit terms 2/10,n/60. Note: Enter debits before credits. Journal entry worksheet Note: Enter debits before credits. Journal entry worksheet Macy returns 100 units because they did not fit the customer's needs (invoice amount: $1,400 ). Note: Enter debits before credits. Journal entry worksheet 122345 Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount. Note: Enter debits before credits