Nov. 4: Purchased merchandise inventory on account from Vancouver Company, $11,0

Question

Nov. 4: Purchased merchandise inventory on account from Vancouver Company, $11,000. Terms 1 /10, n/EOM, FOB shipping point. Date Accounts Debit Credit Nov. 4 Nov. 6: Paid freight bill of $110 on November 4 purchase Date Accounts Debit Credit Nov. 6 Nov. 8: Returned half of the inventory purchased on November 4 from Vancouver Company. Date Accounts Debit Credit Nov. 8 Nov. 10: Sold merchandise inventory for cash, $1,700. Cost of goods, S680. FOB destination Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step Date Accounts Debit Credit Nov. 10 Now journalize the expense related to the November 10 sale-Cost of goods, $680 Date Accounts Debit Credit Nov. 10

Explanation / Answer

Journal Entry Date Explanation Debit Credit 04-Nov Merchandise Inventory 11000 Accounts Payable - V Company 11000 06-Nov Freight in 110 Cash 110 08-Nov Accounts Payable - V Company 5500 Merchandise Inventory 5500 10-Nov Cash 1700 Sales Revenue 1700 10-Nov Cost of Goods Sold 680 Merchandise Inventory 680 11-Nov Accounts Receivable - G Corporation 10600 Sales Revenue 10600 11-Nov Cost of Goods Sold 5830 Merchandise Inventory 5830 12-Nov Freight Out 50 Cash 50 13-Nov Accounts Receivable - C Company 9000 Sales Revenue 9000 13-Nov Cost of Goods Sold 4950 Merchandise Inventory 4950 14-Nov Accounts Payable - V Company 5500 Merchandise Inventory (5500*1%) 55 Cash 5445 17-Nov Sales Return and Allowances 600 Accounts Receivable - C Company 600 17-Nov Merchandise Inventory 330 Cost of Goods Sold 330 18-Nov Merchandise Inventory 4300 Accounts Payable - R Corporation 4300 20-Nov Cash 10388 Sales Discount (10600*2%) 212 Accounts Receivable - G Corporation 10600 26-Nov Accounts Payable - R Corporation 4300 Merchandise Inventory (4300*2%) 86 Cash 4214 28-Nov Cash 8400 Sales Discount Accounts Receivable - C Company 8400 29-Nov Merchandise Inventory 12200 Freight IN 190 Cash 12390

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