Part $1$: Prepare Phineas Inc.$\text{'}$s journal entries for each of the following transactions. Assume

that a perpetual inventory method is used.

Recording Purchases of Merchandise

Phineas Inc. purchases $$80,000$ of inventory on account, terms $\frac{2}{10}$ net

$30$ from Isabella Co$.$

Phineas Inc. returns $$15,000$ of inventory to Isabella Co$.$ from the initial

purchase.

Phineas Inc. pays the balance owed to Isabella Co$.,$ taking the discount.

Recording Sales of Merchandise $($new scenario$)$

Drake Inc. sells merchandise on account for $$25,000($terms $\frac{3}{10}$ net $30)$

to Josh Corp. The merchandise had cost Drake Inc. $$9,500.$

Josh Corp. returns $$5,000$ of the merchandise to Drake Inc. Assume this

returned merchandise had cost Drake Inc. $$1,550.$

Josh Corp. pays Drake Inc. the balance owed within $10$ days of the sale.