The following were selected from among the transactions completed by Babcock Com
ID: 2455337 • Letter: T
Question
The following were selected from among the transactions completed by Babcock Company during November of the current year:
Nov. 3 Purchased merchandise on account from Moonlight Co., list price $85,000, trade discount 25%, terms FOB destination , 2/10, n/30.
4 Sold merchandise for cash, $37,680. The cost of the merchandise sold was $22,600.
5 Purchased merchandise on account from Papoose Creek Co., $47,500, terms FOB shipping point , 2/10, n/30, with prepaid freight of $810 added to the invoice .
6 Returned $13,500 ($18,000 list price less trade discount of 25%) of merchandise purchased on November 3 from Moonlight Co.
8 Sold merchandise on account to Quinn Co., $15,600 with terms n/15. The cost of the merchandise sold was $9,400.
13 Paid Moonlight Co. on account for purchase of November 3, less return of November 6.
14 Sold merchandise on VISA, $236,000. The cost of the merchandise sold was $140,000.
15 Paid Papoose Creek Co. on account for purchase of November 5.
23 Received cash on account from sale of November 8 to Quinn Co.
24 Sold merchandise on account to Rabel Co., $56,900, terms 1/10, n/30. The cost of the merchandise sold was $34,000.
28 Paid VISA service fee of $3,540.
30 Paid Quinn Co. a cash refund of $6,000 for returned merchandise from sale of November 8. The cost of the returned merchandise was $3,300.
Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles.
CHART OF ACCOUNTS Babcock Company General Ledger ASSETS 110 Cash 121 Accounts Receivable-Quinn Co. 122 Accounts Receivable-Rabel Co. 125 Notes Receivable 130 Merchandise Inventory 131 Estimated Returns Inventory 140 Office Supplies 141 Store Supplies 142 Prepaid Insurance 180 Land 192 Store Equipment 193 Accumulated Depreciation-Store Equipment 194 Office Equipment 195 Accumulated Depreciation-Office Equipment LIABILITIES 211 Accounts Payable-Moonlight Co. 212 Accounts Payable-Papoose Creek Co. 216 Salaries Payable 218 Sales Tax Payable 219 Customer Refunds Payable 221 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends 313 Income SummaryExplanation / Answer
JOURNAL ENTRIES DATE ACCOUNTS TITLE AND EXPLANATIONS DEBIT $ CREDIT $ 3-Nov Merchandise Inventory Dr. 63750 Accounts payable-Moonlight Co. 63750 4-Nov Cash Account Dr. 37680 Sales revenue 37680 Cost of Goods sold Dr. 22600 Merchandise Inventory 22600 5-Nov Merchandise Inventory Dr. 48310 Accounts payable- Papoose Creek Co. 47500 Cash Account 810 6-Nov Accounts payable-Moonlight Co. 13500 Merchandise Inventory 13500 8-Nov Accounts recievable -Quinn Co. Dr. 15600 Sales revenue 15600 Cost of Goods sold Dr. 9400 Merchandise Inventory 9400 13-Nov Accounts payable-Moonlight Co. 50250 Cash account 49245 Merchandise Inventory 1005 14-Nov Cash Account Dr. 236000 Sales revenue 236000 Cost of Goods sold Dr. 140,000 Merchandise Inventory 140,000 15-Nov Accounts payable-Papoose Creek Co. 47500 Cash Account 46550 Merchandise Inventory 950 23-Nov Accounts receivable-Quinn 15600 cash Account 15600 24-Nov Accounts receivable-rabel Co. Dr. 56900 Sales revenue 56900 Cost of Goods sold Dr. 34000 Merchandise Inventory 34000 28-Nov Visa Service expense Dr. 3540 Cash Account 3540 30-Nov Sales return Dr. 6000 Cash Account 6000 Estimated return inventory Dr. 3300 Cost of Goods sold 3300
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