p5-31 P5-31A Journalizing purchase and sale transactions Journalize the followin
ID: 2562088 • Letter: P
Question
p5-31 P5-31A Journalizing purchase and sale transactions Journalize the following transactions that occurred in September 2016 for Cardinal No explanations are needed. Identify each accounts payable and accounts receivable with the vendor or customer name. Purchased merchandise inventory on account from Sherry Wholesalers, $4,000 Terms 1/15, n/EOM, FOB shipping point Sep. 3 4 Paid freight bill of $75 on September 3 purchase 4 Purchased merchandise inventory for cash of $1,900. 6 Returned $1,100 of inventory from September 3 purchase. 8 Sold merchandise inventory to Houston Company, $5,500, on account. Terms 3/15, n/35. Cost of goods, $2,365. Purchased merchandise inventory on account from Tarin Wholesalers, $12,000 Terms 3/10, n/30, FOB destination. Made payment to Sherry Wholesalers for goods purchased on September 3, less return and discount. 9 10 Received payment from Houston Company, less discount. After negotiations, received a $200 allowance from Tarin Wholesalers Sold merchandise inventory to Java Company, $3,300, on account. Terms 2/10, n/EOM. Cost of goods, $1,320 Made payment, less allowance, to Tarin Wholesalers for goods purchased on September 9. Java Company returned $900 of the merchandise sold on September 15. Cost of goods, $360 Sold merchandise inventory to Smecker for $1,900 on account that cost $722. Terms of 1/10, n/30 was offered, FOB shipping point. As a courtesy to Smecker, $85 of freight was added to the invoice for which cash was paid by Cardinal After negotiations, granted a $200 allowance to Smecker for merchandise purchased on September 25 12 13 15 22 23 25 26Explanation / Answer
Answer:
Journal Entries
Date
Accounts and Explanation
Debit
Credit
Sep. 3
Merchandise Inventory
4,000
Accounts Payable—Sherry Wholesalers
4,000
4
Merchandise Inventory
75
Cash
75
4
Merchandise Inventory
1,900
Cash
1,900
6
Accounts Payable—Sherry Wholesalers
1,100
Merchandise Inventory
1,100
8
Accounts Receivable—Houston Company
5,500
Sales Revenue
5,500
Cost of Goods Sold
2,365
Merchandise Inventory
2,365
9
Merchandise Inventory
12,000
Accounts Payable—Tarin Wholesalers
12,000
10
Accounts Payable—Sherry Wholesalers ($4,000 – $1,100)
2,900
Cash ($2,900 – $29)
2,871
Merchandise Inventory ($2,900 × 0.01)
29
12
Cash ($5,500 – $165)
5,335
Sales Discounts ($5,500 × 0.03)
165
Accounts Receivable—Houston Company
5,500
13
Accounts Payable—Tarin Wholesalers
200
Merchandise Inventory
200
15
Accounts Receivable—Java Company
3,300
Sales Revenue
3,300
Cost of Goods Sold
1,320
Merchandise Inventory
1,320
22
Accounts Payable—Tarin Wholesalers ($12,000 – $200)
11,800
Cash
11,800
Sep. 23
Sales Returns and Allowances
900
Accounts Receivable—Java Company
900
Merchandise Inventory
360
Cost of Goods Sold
360
25
Accounts Receivable—Smecker
1,985
Sales Revenue
1,900
Cash
85
Cost of Goods Sold
722
Merchandise Inventory
722
26
Sales Returns and Allowances
200
Accounts Receivable—Smecker
200
29
Cash ($1,785 – $17)
1,768
Sales Discounts (($1,900 – $200) × 0.01)
17
Accounts Receivable—Smecker ($1,985 – $200)
1,785
30
Cash
2,400
Accounts Receivable—Java Company ($3,300 – $900)
2,400
Date
Accounts and Explanation
Debit
Credit
Sep. 3
Merchandise Inventory
4,000
Accounts Payable—Sherry Wholesalers
4,000
4
Merchandise Inventory
75
Cash
75
4
Merchandise Inventory
1,900
Cash
1,900
6
Accounts Payable—Sherry Wholesalers
1,100
Merchandise Inventory
1,100
8
Accounts Receivable—Houston Company
5,500
Sales Revenue
5,500
Cost of Goods Sold
2,365
Merchandise Inventory
2,365
9
Merchandise Inventory
12,000
Accounts Payable—Tarin Wholesalers
12,000
10
Accounts Payable—Sherry Wholesalers ($4,000 – $1,100)
2,900
Cash ($2,900 – $29)
2,871
Merchandise Inventory ($2,900 × 0.01)
29
12
Cash ($5,500 – $165)
5,335
Sales Discounts ($5,500 × 0.03)
165
Accounts Receivable—Houston Company
5,500
13
Accounts Payable—Tarin Wholesalers
200
Merchandise Inventory
200
15
Accounts Receivable—Java Company
3,300
Sales Revenue
3,300
Cost of Goods Sold
1,320
Merchandise Inventory
1,320
22
Accounts Payable—Tarin Wholesalers ($12,000 – $200)
11,800
Cash
11,800
Sep. 23
Sales Returns and Allowances
900
Accounts Receivable—Java Company
900
Merchandise Inventory
360
Cost of Goods Sold
360
25
Accounts Receivable—Smecker
1,985
Sales Revenue
1,900
Cash
85
Cost of Goods Sold
722
Merchandise Inventory
722
26
Sales Returns and Allowances
200
Accounts Receivable—Smecker
200
29
Cash ($1,785 – $17)
1,768
Sales Discounts (($1,900 – $200) × 0.01)
17
Accounts Receivable—Smecker ($1,985 – $200)
1,785
30
Cash
2,400
Accounts Receivable—Java Company ($3,300 – $900)
2,400
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