Purchase-Related Transactions Journalize entries for the following related trans

Question

Purchase-Related Transactions

Journalize entries for the following related transactions of Manville Heating & Air Company:

a. Purchased $31,000 of merchandise from Wright Co. on account, terms 2/10, n/30.

b. Paid the amount owed on the invoice within the discount period.

c. Discovered that $6,200 of the merchandise purchased in (a) was defective and returned items, receiving credit.

d. Purchased $4,700 of merchandise from Wright Co. on account, terms n/30.

e. Received a refund from Wright Co. for return in (c) less the purchase in (d).

Explanation / Answer

Journal Entries Date ACCT Title and explanation Debit Credit A) Mechandiise Account $31,000.00      To Account Payable $31,000.00 (Being merchnatile is purchased on credit) Account Payable $31,000.00 b)     To Purchase Discount $620.00     To Cash Account $30,380.00 (Being amount paid against purchase on credit) c) Purcahse Return $6,076.00 Discount on Purchase $124.00       To Merchandise Account $6,200.00 (Being Merchndise is return to supplier) Mechandiise Account $4,700.00 d)      To Account Payable $4,700.00 (Being merchnatile is purchased on credit) e) Cash Account $6,076.00     To Purchase Return $6,076.00 (Being cash recived on purchase return)

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