Journalize the following transactions assuming a perpetual inventory system.: Ma
ID: 2374591 • Letter: J
Question
Journalize the following transactions assuming a perpetual inventory system.:
May 5
Purchased merchandise from Archie Co., $6,000, terms FOB shipping point, 2/10, n/30.
Prepaid freight costs of $100 were added to the invoice.
May 12
Issued a debit memo to Archie Co., for $2,500 of merchandise returned from purchase on May 5th.
May 14
Paid Archie Co. for invoice of May 5, less debit memo of May 12 and discount.
Journal
Date
Description
Post Ref
Debit
Credit
May 5
Purchased merchandise from Archie Co., $6,000, terms FOB shipping point, 2/10, n/30.
Prepaid freight costs of $100 were added to the invoice.
May 12
Issued a debit memo to Archie Co., for $2,500 of merchandise returned from purchase on May 5th.
May 14
Paid Archie Co. for invoice of May 5, less debit memo of May 12 and discount.
Explanation / Answer
Hi,
Please find the answer as follows:
May 5
Merchandise Inventory Dr. (6000 + 100) 6100
Accounts Payable Cr. 6100
May 12
Accounts Payable Dr. 2500
Merchandise Inventory Cr. 2500
May 14
Accounts Payable Dr. (6000 - 2500 + 100) 3600
Cash Cr. (3600 - 70) 3530
Merchandise Inventory Cr. 70
Thanks.
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