Recording Purchase Transactions (Appendix 6A)

For Mathis Company and Reece Company, the following transactions occurred during the month of April:

1. On April 1, Mathis Company purchased merchandise on account from Reece Company with credit terms of 2/10, n/30. The selling price of the merchandise was $3,700 and the cost of the merchandise sold was $2,450.
2. On April 1, Mathis paid freight charges of $100 cash to have the goods delivered to its warehouse.
3. On April 8, Mathis returned $1,000 of the merchandise which had originally cost Reece $700.
4. On April 10, Mathis paid Reece the balance due.

Assume that Mathis uses a periodic inventory system.

1. Prepare the journal entry to record the April 1 purchase of merchandise and payment of freight by Mathis Company

(Purchased inventory on account)

2. Prepare the journal entry to record the April 8 return of merchandise.

(Paid cash for shipping fees)

3. Prepare the journal entry to record the April 10 payment to Reece Company

(Recorded payment within the discount period)

If an amount box does not require an entry, leave it blank.