This information relates to Crisp Co. (Credit account titles are automatically i

Question

This information relates to Crisp Co. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

i need help with the red part which is for april 15th and i need help with b. please show all steps. thank you.

1. On April 5, purchased merchandise from Frost Company for $27,100, terms 2/10, n/30. 2. On April 6, paid freight costs of $520 on merchandise purchased from Frost. 3. On April 7, purchased equipment on account for $30,800. 4. On April 8, returned $5,200 of April 5 merchandise to Frost Company. 5. On April 15, paid the amount due to Frost Company in full.

Explanation / Answer

(a) Prepare the journal entries to record the transactions listed above on the books of Prophet Co.
1. On April 5 purchased merchandise from Frost Companyfor $27,100, terms 2/10, n/30.

Dr merchannvised nventory(MI) $27,100
Cr Accounts payable (AP) $27,100

2. On April 6 paid freight costs of $520 on merchandise purchased from Frost.
Dr MI 520
Cr Cash $520



3. On April 7 purchased equipment on account for $30,800
Dr Equipment $30,800
Cr AP $30,800

4. On April 8 returned some of April 5 merchandise toFrost Company. which cost $5200
Dr AP $5200
Cr MI $5200



5. On April 15 paid the amount due to Frost Company in full

Dr AP $21900 ($27,100 - $5200 )

Cr Cash $21462

Cr MI $428 (2% x $21,900)

(b)
5. On May 4 paid the amount due to Frost Company in full
Dr AP $21900
Cr Cash $21900

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