The following were selected from among the transactions completed by Babcock Com
ID: 2539670 • Letter: T
Question
The following were selected from among the transactions completed by Babcock Company during November of the current year:
Required:
Journalize the transactions.
Nov. 3. Purchased merchandise on account from Moonlight Co., list price $82,000, trade discount 25%, terms FOB destination, 2/10, n/30. 4. Sold merchandise for cash, $40,700. The cost of the goods sold was $22,290. 5. Purchased merchandise on account from Papoose Creek Co., $49,000, terms FOB shipping point, 2/10, n/30, with prepaid freight of $780 added to the invoice. 6. Returned $15,000 ($20,000 list price less trade discount of 25%) of merchandise purchased on November 3 from Moonlight Co. 8. Sold merchandise on account to Quinn Co., $16,790 with terms n/15. The cost of the merchandise sold was $9,870. 13. Paid Moonlight Co. on account for purchase of November 3, less return of November 6. 14. Sold merchandise on VISA, $219,080. The cost of the goods sold was $147,900. 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., $60,500, terms 1/10, n/30. The cost of the goods sold was $32,170. 28. Paid VISA service fee of $3,370. 30. Paid Quinn Co. a cash refund of $6,040 for returned merchandise from sale of November 8. The cost of the returned merchandise was $3,450.Explanation / Answer
Date Accounts and Explanation Debit Credit 3-Nov Merchandise inventory (82000*75%) $ 61,500.00 Accounts payable- Moonlight $ 61,500.00 ( To record the purchase of inventory on account at a trade discount 25%) 4-Nov Cash $ 40,700.00 Sales revenue $ 40,700.00 ( To record the sale of merchandise inventory for cash) Cost of goods sold $ 22,290.00 Merchandise inventory $ 22,290.00 ( To record the cost of goods sold) 5-Nov Merchandise inventory (49000+780) $ 49,780.00 Accounts payable-papoose $ 49,780.00 ( To record the purchase of inventory on account) 6-Nov Accounts payable - MoonLight $ 15,000.00 Merchandise inventory (20000*75%) $ 15,000.00 ( To record the purchase returns) 8-Nov Accounts Receivable - Quinn $ 16,790.00 Sales revenue $ 16,790.00 ( To record the sales on account to Quinn) Cost of goods sold $ 9,870.00 Merchandise inventory $ 9,870.00 ( To record the cost of goods sold) 13-Nov Accounts payable - MoonLight (61500-15000) $ 46,500.00 Merchandise inventory (46500*2%) $ 930.00 Cash (46500*98%) $ 45,570.00 ( To record the payment towards accounts payable to Moonlight 14-Nov Cash $ 219,080.00 Sales revenue $ 219,080.00 ( To record the sales by cash) Cost of goods sold $ 147,900.00 merchandise inventory $ 147,900.00 ( To record the cost of goods sold) 15-Nov Accounts payable - papoose $ 49,780.00 Merchandise inventory (49780*2%) $ 995.60 Cash $ 48,784.40 ( To record the payment of cash towards accounts payable to papoose 23-Nov cash $ 16,790.00 Accounts Receivable - Quinn $ 16,790.00 ( To record the receipt of cash from accounts receivable from Quinn 24-Nov Accounts receivable-Rabel $ 60,500.00 Sales revenue $ 60,500.00 ( To record the sale on credit to Rabel Cost of goods sold $ 32,170.00 Merchandise inventory $ 32,170.00 ( To record the cost of goods sold) 24-Nov Credit card Expense $ 3,370.00 Cash $ 3,370.00 ( To record the payment of visa service fees 30-Nov sales returns and allowances $ 6,040.00 Cash $ 6,040.00 ( To record the sales return) merchandise inventory $ 3,450.00 Cost of goods sold $ 3,450.00 ( To record the reversal of cost of goods sold)
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