Journalizing Transactions Under Periodic and Perpetual Inventory System

PROBLEM: The following were the selected buying and selling activities of Laguna Department Store owned and managed by Cecille Laguna, CPA.

1. Bought merchandise on account from A. Pedrosa Co., P100,000. Terms: 2% discount if paid within 10 days; no discount beyond 10 days but payable within 30 days. Paid freight on shipment, P700.

2. A. Pedrosa Co. returned merchandise costing P5,000 for not conforming with size order and was not replaced as the items ordered were out of stock.

3. Sold merchandise on account to R. Miranda Trading, P80,000. Terms: 2% discount if paid within 10 days; no discount beyond 10 days but payable within 30 days. The cost of merchandise sold was P60,000.

4. R. Miranda Trading returned merchandise costing P2,000 which had been sold for P3,500. It was not replaced.

5. Upon due date, A. Pedrosa Co. paid their account net of return and discount.

6. Upon due date, Laguna Department Store collected the amount net of returns and discounts.

REQUIRED: In a table, prepare comparative journal entries. Follow the suggested format below:

1st column - Transactions

2nd column - Periodic

3rd column - Perpetual