Recording Purchases: Perpetual Inventory System E9A. The transactions that follo

Question

Recording Purchases: Perpetual Inventory System E9A. The transactions that follow took place under the perpetual inventory system. Record each transaction using T accounts. a. Purchased merchandise on credit, terms n/30, FOB shipping point, $5,000. b. Paid freight on the shipment in transaction a, s270. c. Purchased merchandise on credit, terms n/30, FOB destination, $2,80. LO4 d. Purchased merchandise on credit, terms n/30, FOB shipping point, $5,200, which includes freight paid by the supplier of $400. e. Returned part of the merchandise purchased in transaction c, S f. Paid the amount owed on the purchase in transaction a. g. Paid the amount owed on the purchase in transaction d. h. Paid the amount owed on the purchase in transa 1,000. ction c less the return in e.

Explanation / Answer

S.no. Accounts title Debit $ Credit $ a. Merchandise Inventory Dr. 5000      Accounts payable 5000 b. Merchandise Inventory Dr. 270      Cash account 270 c. Merchandise Inventory Dr. 2800      Accounts payable 2800 d Merchandise Inventory Dr. 5600      Accounts payable 5600 e. Accounts payable Dr. 1000     Merchandise Inventory 1000 f. Accounts payable Dr. 5000      Cash Account 5000 g. Accounts payable Dr. 5600      Cash Account 5600 h. Accounts payable Dr. 1800      Cash Account 1800 Note: In transactiond, the responsibility of shipping cost is of purchaser but paid by supplier. In such cases, the Merchandise cost will be increased and the amount of freight is also due to be paid to Supplier

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