On June 10, Vareen Company purchased 9,000 of merchandise from Harrah Com- pany, FOB shipping point,...

 

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On June 10, Vareen Company purchased £9,000 of merchandise from Harrah Com- pany, FOB shipping point, terms 3/10, n/ 30. Vareen pays the freight costs of £500 on June 11. Damaged goods totaling £200 are returned to Harrah for credit on June 12. The fair value of these goods in £70. On June 19, Vareen pays Harrah Company in full, less the purchase discount. Both companies use a perpetual inventory system. Instructions (a) Prepare separate entries for each transaction on the books of Vareen Company. (b) Prepare separate entries for each transaction for Harrah Company. The merchandise purchased by Vareen on June 10 had cost Harrah £4,800. On June 10, Vareen Company purchased £9,000 of merchandise from Harrah Com- pany, FOB shipping point, terms 3/10, n/ 30. Vareen pays the freight costs of £500 on June 11. Damaged goods totaling £200 are returned to Harrah for credit on June 12. The fair value of these goods in £70. On June 19, Vareen pays Harrah Company in full, less the purchase discount. Both companies use a perpetual inventory system. Instructions (a) Prepare separate entries for each transaction on the books of Vareen Company. (b) Prepare separate entries for each transaction for Harrah Company. The merchandise purchased by Vareen on June 10 had cost Harrah £4,800.

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9 Books of vareen Company Date Account T itle a Explanation Debit credit Merchandi... View the full answer