July 1 Purchased suitcases on account for $1,800 from Trunk Manufacturers, FOB d
ID: 2434841 • Letter: J
Question
July 1 Purchased suitcases on account for $1,800 from Trunk Manufacturers, FOB destination, terms 2/10, n/30. The appropriate party also made a cash payment of $100 for freight on this date.3 Sold suitcases on account to Satchel World for $2,000. The cost of suitcases sold is $1,200.
9 Paid Trunk Manufacturers in full.
12 Received payment in full from Satchel World.
17 Sold suitcases on account to The Going Concern for $1,500. The cost of the suite cases sold was $900
18 Purchased suitcases on account for $1,700 from Kingman Manufacturers, FOB shipping point, terms 1/10, n/30. The appropriate party also made a cash payment of $100 for freight on this date.
20 Received $300 credit (including freight) for suitcases returned to Kingman Manufacturers.
21 Received payment in full from The Going Concern.
22 Sold suitcases on account to Fly-By-Night for $2,250. The cost of the suitcases sold was $1,350.
30 Paid Kingman Manufacturers in full.
31 Granted Fly-By-Night $200 credit for suitcases returned costing $120.
Sansomite's chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Merchandise Inventory, No. 201 Accounts Payable, No. 401 Sales, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, No. 505 Cost of Goods Sold.
Journalize the transactions for the month of July for Sansomite using a perpetual inventory system.
Explanation / Answer
I will try. I am not sure if "The appropriate party also made a cash payment of $100 for freight on this date" means that the Samsonite Company paid the $100 for freight but that's what I am assuming. July 1 Debit Merchandise Inventory Acct 120 $1,800 (60 suitcases at $30 each) Credit Acct 201 Accounts Payable $1,800 July 1 Debit Accounts Payable 100 Credit Cash Acct. 101 100 July 3 Credit Sales Account 401 2000 (40 x $50) Debit Accounts Receivable 2000 July 9 Credit Cash Account 101 $1,700 Debit Acct 201 Accounts Payable 1,700 July 12 They give a 1% sales discount if paid in 10 days - so Satchel World bought $2000. That gives them a discount of $20. Amount they owe is now $1980 July 12 Debit Accounts Receivable 20 Credit Sales Discounts Acct 414 20 Debit Cash Account 101 1980 Credit Accounts Receivable 1980 That should give you enough help to do the other questions
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