During the months of January and February, Solitare Corporation sold goods to th

Question

During the months of January and February, Solitare Corporation sold goods to three customers. The sequence of events was as follows Jan. 6 Sold goods for $200 to Wizard Inc. with terms 4/10, n/30. The goods cost Solitare $110 6 Sold goods to Spyder Corp. for $160 with terms 4/10, n/30. The goods cost Solitare $100. 14 Collected cash due from Wizard Inc. Feb. 2 Collected cash due from Spyder Corp. 28 Sold goods for $130 to Bridges with terms 4/10, n/45. The goods cost Solitare $70. Required: Prepare journal entries to record the transactions, assuming Solitare uses a perpetual inventory system. (If no entry is required for a transaction/event, select" No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the sales on account of $200 to Wizard Inc. on terms 4/10, n/30. Note: Enter debits before credits. Date General Journal Debit Credit Jan. 6 Record entry Clear entry View general journal

Explanation / Answer

Answer: Journal Entries, along with workings: [Gross recording method being used)

Date General Journal Debit Credit Working (if any) Jan-06 Accounts receivables $                                   200.00 Sales revenue $                     200.00 (sold merchandise on account) Jan-06 Cost of Goods Sold $                                   110.00 Inventory $                     110.00 (Cost of merchandise sold adjusted) Jan-06 Accounts receivables $                                   160.00 Sales revenue $                     160.00 (sold merchandise on account) Jan-06 Cost of Goods Sold $                                   100.00 Inventory $                     100.00 (Cost of merchandise sold adjusted) Jan-14 Cash $                                   192.00 [$200 x 96%] Inventory $                                        8.00 [$200 x 4% discount] Accounts receivables $                     200.00 (payment received within discount term of 10 days) Feb-02 Cash $                                   160.00 Accounts receivables $                     160.00 (payment received after discount term of 10 days: no discount) Feb-28 Accounts receivables $                                   130.00 Sales revenue $                     130.00 (sold merchandise on account) Cost of Goods Sold $                                     70.00 Inventory $                       70.00 (Cost of merchandise sold adjusted)

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