The following documents describe two business transactions:

Required
1. Use the general journal to record these transactions and Eddie's Bicycle Shop's cash payment on March 21. Record the transactions first on the books of Eddie's Bicycle Shop and then on the books of Schwinn Company, which makes and sells bicycles. Both Eddie's Bicycle Shop and Schwinn Company use a perpetual inventory system. Schwinn Company's cost of the bicycles sold to Eddie's Bicycle Shop was $1,280. Schwinn Company's cost of the returned merchandise was $256. Round to the nearest dollar. Explanations are not required. Using the perpetual system of inventory, set up your answer in the following format:
Date Eddie's Bicycle Shop Journal Entries Schwinn Journal Entries
2. How would your answer be different if both of these companies used the periodic inventory system?

Transcribed Image Text:

Invoice Debit Memo March 14, 2014 Eddie's Bicycle shop March 20, 2014 Date: Date: Issued to: Sold to: Schwinn Company Eddie's Bicycle Shop Sold by: _ Schwinn Company Issued by: Terms: 2/10, n/30 Items Returneed_ Items Purchased Bicycles Bicycles Quantity Price Total Quantity Price Total $152 $1,216 $152 $304 112 224 112 224 Total.. 10 96 960 $528 Total. $2,400 Damaged in shipment Reason: