Question

Question 1 Ivanhoe Company is a furniture retailer and uses the perpetual inventory system. On January 14, 2022, Ivanhoe purchased merchandise inventory at a cost of $54,000. Credit terms were 2/10, n/30. The inventory was sold on account for $73,000 on January 21, 2022. Credit terms were 1/10, n/30. The accounts payable was settled on January 23, 2022, and the accounts receivables were settled on January 30, 2022. Prepare journal entries to record each of these transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit Jan. 14 Inventory 54000 Accounts Payable 54000 Jan. 21 Accounts Receivable Sales Returns and Allowances (To record credit sale) Cost of Goods Sold Jan. 21. 54000 Invenetory 54000 (To record cost of good sold) Jan. 23 Accounts Payable 54000 Cash Inventory Jan 30 Cash

Answer 1

Account title and explanation Debit Credit Date Jan. 14, 2022 Inventory 54,000 Accounts payable 54,000 Jan. 21, 2022 Accounts receivable 73,000 Sales revenue 73,000 (To record credit sales) Jan. 21, 2022 Cost of goods sold 54,000 Inventory 54,000 (To record cost of goods sold) Jan. 23, 2022 Accounts payable Cash (54,000x98%) 54,000 52,920 Inventory (54,000x2%) 1,080 Jan. 30, 2022 Cash 72,270 Sales discount (73,000x1%) 730 Accounts receivable 73,000