Journalize the following transactions for the seller, Carter Company, using the
ID: 2417866 • Letter: J
Question
Journalize the following transactions for the seller, Carter Company, using the gross method to account for sales discounts. Assume a perpetual inventory system. Make sure to enter the day for each separate transaction.
Journalize the following transactions for the seller, Carter Company, using the gross method to account for sales discounts. Assume a perpetual inventory system. Make sure to enter the day for each separate transaction.
January 10 Sold goods costing $9,000 to Walker Company on account, $15,000, terms 5/10, n/30. The goods are sold FOB shipping point, freight prepaid by seller, $90. January 16 Walker Company returned damaged merchandise previously purchased on account, $2,500. January 21 Received the amount due from Walker Company.Explanation / Answer
Journal Entry Date Particulars Dr. Amt Cr. Amt Jan.10 Accounts receivables Dr. 15000 To Sales 15000 (Goods Sold to Walker Co.) Jan.10 Cost of Goods Sold dr. 9000 To Merchandise Inventory 9000 (To record cost of goods sold to Walker Co.) Jan.10 Freight Exp. Dr. 90 To Cash 90 (freight paid for the goods sold to Walker Co.) Jan.16 Sales Returns Dr. 2500 To Accounts Receivables 2500 (Goods return by Walker Co. Sold earlier) Jan.16 Merchandise Inventory Dr. 1500 To Cost of Goods Sold 1500 (To record cost of goods return by Walker Co. -9000/15000 X 2500) Jan. 21 Cash Dr. 12500 To Accounts receivables 12500 (Amount recd from Walker Co.) Note: No Sales Discount is given to Walker Co. Since, Wailker Co. has made the payment on 11 day. If it gives within or on 10 days, it will be eligible for sales discount of 5%.
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