Question 2

Question 2 [20 points] Given the following prepare the entries that both the purchaser and seller should record for these transactions. Assume both companies use a perpetual inventory system. a July 4: Callaho Inc.'s merchandise that cost $4.050 was sold to Gulf Corp. for $4,500 under credit terms of 2/15, 1/60, FOB shipping point. b. July 14: Gulf Corp. received a $500 credit memorandum from Callaho Inc. acknowledging the return of defective merchandise c. July 20: Gulf Corp. paid Callaho Inc. the balance due. Enter the transaction letter as the description when entering the transactions in the journal. Dates must be entered in the format dd/mmm (.e., January 15 would be 15/Jan). Please use the 't' and '-' buttons to change the number of accounts (if necessary) for each journal entry. a) Gulf Corp. b) Callaho Inc. General Journal Account/Explanation Page GJ2 F Debit Credit General Journal Account/Explanation Page GJ4 F Debit Credit Date Date + +