This information relates to Blossom Co.. 1. On April 5, purchased merchandise fr

Question

This information relates to Blossom Co..

1. On April 5, purchased merchandise from Sunland Company for $28,800, terms 4/10, n/30.

2. On April 6, paid freight costs of $620 on merchandise purchased from Sunland Company.

3. On April 7, purchased equipment on account for $34,200.

4. On April 8, returned $3,500 of April 5 merchandise to Sunland Company.

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

Prepare the journal entries to record the transactions listed above on Blossom Co.’s books. Blossom Co. uses a perpetual inventory system. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

Assume that Blossom Co. paid the balance due to Sunland Company on May 4 instead of April 15. Prepare the journal entry to record this payment. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)

1. On April 5, purchased merchandise from Sunland Company for $28,800, terms 4/10, n/30.

2. On April 6, paid freight costs of $620 on merchandise purchased from Sunland Company.

3. On April 7, purchased equipment on account for $34,200.

4. On April 8, returned $3,500 of April 5 merchandise to Sunland Company.

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

Explanation / Answer

Journal Entries :

Date Accounts Titles Debit $ Credit $ April 5 Merchandise Inventory 28800 Accounts Payable 28800 (purchase of inventory) April 6 Freight inward 620 Cash 620 April 7 Equipment 34200 Accounts Payable 34200 April 8 Accounts Payable 3500 Merchandise Inventory 3500 April 15 Accounts Payable 25300 Trade discount 1012 Cash 24288 (28800-3500=25300 * 4% =1012) May 4 Accounts Payable 25300 Cash 25300 (no trade discount if paid over 10 days)

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